Unfortunately that a Warfield residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the early years due to the reduction being disguised by increases in the Warfield property market.Once your lease gets to 85ish years, you need to start considering a lease extension. If lease term slips under eighty years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property The majority of flat owners in Warfield will be able to extend under the legislation; however a lawyer should be able to clarify if you qualify for an extension. In some cases you may not be entitled. There are also strict timetables and procedures to be adhered to once the process is initiated and you will need to be guided by your lawyer throughout the formalities.
Leasehold residencies in Warfield with more than one hundred years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges merit 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. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service gives you enhanced control over the value of your Warfield leasehold, as your property will be more valuable and saleable in respect of lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In recent months Max, came perilously near to the 80-year mark with the lease on his first floor apartment in Warfield. In buying his property two decades ago, the length of the lease was of no bearing. Thankfully, he realised he needed to take steps soon on Extending the lease. Max arranged for a lease extension just under the wire last March. Max and the landlord ultimately agreed on a premium of £5,500 . If he failed to meet the deadline, the sum would have escalated by a minimum £1,100.
Mr and Mrs. H Peterson completed a recently refurbished flat in Warfield in February 2008. The dilemma was if we could approximate the compensation to the landlord could be to extend the lease by an additional years. Similar properties in Warfield with an extended lease were valued around £246,800. The average amount of ground rent was £60 invoiced quarterly. The lease ran out on 12 November 2076. Having 50 years unexpired we approximated the compensation to the landlord to extend the lease to be within £44,700 and £51,600 not including legals.
In 2009 we were approached by Mr Kai Gómez who, having moved into a one bedroom apartment in Warfield in April 2010. We are asked if we could approximate the price would be for a 90 year lease extension. Comparative premises in Warfield with an extended lease were worth £208,200. The average amount of ground rent was £65 collected every twelve months. The lease terminated on 14 July 2087. Having 61 years as a residual term we calculated the compensation to the landlord to extend the lease to be between £20,000 and £23,000 plus expenses.