It’s an underpublicised truth that a Verwood residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Verwood property prices.Where your lease has approximately 90 years left, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips lower than 80 years - otherwise a higher premium will be payable. Most leasehold owners in Verwood will be able to extend under the legislation; however a conveyancer will be able to confirm whether you are eligibility. In some situations you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancer for the duration of the formalities.
Leasehold properties in Verwood with over 100 years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
| Chelsea Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Yorkshire Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
Lease extensions in Verwood can be a difficult process. We recommend you procure guidance from a conveyancing solicitor and valuer with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Verwood lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Trailing unsuccessful discussions with the freeholder of her ground floor flat in Verwood, Lily started the lease extension process just as the lease was coming close to the all-important 80-year deadline. The lease extension was finalised in July 2012. The freeholder’s charges were restricted to approximately 450 GBP.
In 2011 we were approached by Mr Gabriel Torres who, having owned a one bedroom apartment in Verwood in November 1996. We are asked if we could shed any light on how much (roughly) premium would be for a ninety year extension to my lease. Similar homes in Verwood with 100 year plus lease were worth £280,000. The mid-range amount of ground rent was £55 collected monthly. The lease end date was on 23 September 2103. Considering the 77 years remaining we calculated the premium to the landlord for the lease extension to be within £13,300 and £15,400 plus costs.
Last Christmas we were phoned by Dr L Patel , who completed a one bedroom flat in Verwood in November 2012. The question was if we could estimate the compensation to the landlord could be to prolong the lease by 90 years. Comparable premises in Verwood with 100 year plus lease were worth £183,600. The average ground rent payable was £65 billed annually. The lease lapsed in 2083. Given that there were 57 years outstanding we approximated the premium to the freeholder for the lease extension to be within £28,500 and £33,000 exclusive of fees.