Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will usually be granted for a set period of time , usually 99 or 125 years, although we have seen longer and shorter terms in Wanstead. Clearly, the term of lease left reduces over time. This may pass by relatively unnoticed when the residence has to be disposed of or refinanced. The shorter the lease the less it is worth and the more it will cost to extend the lease. Qualifying leaseholders in Wanstead have the right to extend the lease for a further 90 years under legislation. You should give due deliberation before putting off your Wanstead lease extension. Putting off that expense now likely increases the price you will ultimately have to pay for a lease extension
It is generally considered that a residential leasehold with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 35 years unexpired, the property will be worth the same as a freehold for decades to come.
| 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service will provide you increased control over the value of your Wanstead leasehold, as your property will be more valuable and saleable in respect of lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to unsuccessful negotiations with the landlord of her purpose-built flat in Wanstead, Caitlin commenced the lease extension process as the eighty year threshold was fast advancing. The transaction was finalised in February 2014. The landlord’s costs were restricted to less than 500 pounds.
Last Summer we were approach by Ms I Williams , who moved into a garden apartment in Wanstead in June 2007. The dilemma was if we could estimate the compensation to the landlord would be to extend the lease by a further 90 years. Comparable flats in Wanstead with a long lease were in the region of £280,000. The mid-range ground rent payable was £45 billed annually. The lease lapsed on 11 January 2096. Given that there were 70 years left we calculated the premium to the landlord for the lease extension to be between £12,400 and £14,200 not including legals.
An example of a Freehold Enfranchisement case for a Wanstead property is 36 New Wanstead in August 2010. The Tribunal arrived at a valuation of the premium for the freehold of £22,359. This case was in relation to 2 flats. The unexpired residue of the current lease was 73.92 years.