The market value of Walworth leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can escalate significantly once the remaining term is below than 80 years
Leasehold residencies in Walworth with in excess of one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
The conveyancing solicitors that we work with undertake Walworth lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancing solicitor we work with provide it.
Half a year ago Ethan, started to get near to the eighty-year mark with the lease on his leasehold flat in Walworth. In buying his home 19 years previously, the unexpired term was of little bearing. Fortunately, he became aware that he needed to take action soon on Extending the lease. Ethan extended the lease at the eleventh hour in January. Ethan and the landlord eventually agreed on a premium of £5,500 . If he had missed the deadline, the figure would have become more exhorbitant by a minimum £875.
Last Summer we were called by Mrs Ashleigh Mason , who acquired a basement flat in Walworth in September 2009. We are asked if we could approximate the price would be to prolong the lease by a further 90 years. Identical homes in Walworth with 100 year plus lease were in the region of £265,000. The average amount of ground rent was £50 billed every twelve months. The lease came to a finish in 2097. Given that there were 73 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 plus expenses.
An example of a Freehold Enfranchisement decision for a Walworth property is 28 Valmar Road in June 2013. this was a case with an absentee freeholder. As a result the leaseholders applied to the Lambeth County Court for an order dispensing with the giving of a notice of claim. On 25 April 2013 District Judge Zimmels made a vesting order and directed that the matter should be transferred to this tribunal to determine the premium. The tribunal concluded on a figure of £1,125 This case related to 3 flats. The unexpired term was 968 years.