The value of Warrington leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can escalate materialy once the unexpired lease term is less than 80 years
Leasehold properties in Warrington with in excess of 100 years remaining on the lease are often referred to as ‘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 upside in buying the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Using our service gives you increased control over the value of your Warrington leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last October Ollie, came seriously near to the eighty-year threshold with the lease on his basement flat in Warrington. Having purchased his property 18 years previously, the lease term was of minimal interest. As luck would have it, it dawned on him that he needed to take action soon on a lease extension. Ollie extended the lease at the eleventh hour in January. Ollie and the freeholder ultimately agreed on the final figure of £5,500 . If the lease had gone to less than eighty years, the figure would have escalated by at least £900.
Last Autumn we were phoned by Mr and Mrs. W Green , who was assigned a lease of a first floor apartment in Warrington in May 2009. The dilemma was if we could estimate the compensation to the landlord would be to prolong the lease by ninety years. Comparable homes in Warrington with an extended lease were in the region of £227,800. The mid-range amount of ground rent was £45 collected yearly. The lease expired on 12 May 2090. Taking into account 65 years as a residual term we calculated the compensation to the landlord for the lease extension to be within £13,300 and £15,400 exclusive of fees.
In 2009 we were called by Dr C Díaz who, having purchased a one bedroom apartment in Warrington in October 2008. The question was if we could estimate the premium would likely be to extend the lease by 90 years. Comparative flats in Warrington with 100 year plus lease were worth £275,000. The average amount of ground rent was £55 invoiced per annum. The lease came to a finish in 2101. Considering the 76 years as a residual term we calculated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 plus expenses.