Unfortunately that a Wellesbourne residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Wellesbourne property market.Once your lease nears 85ish years, you should start considering 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 falls below eighty years - otherwise a higher amount will be due. Most flat owners in Wellesbourne will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify if you qualify for an extension. In some cases you may not qualify. There are also strict deadlines and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancer from beginning to end of the formalities.
Leasehold premises in Wellesbourne with over 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in buying the freehold unless savings on ground rent and maintenance charges justify 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 should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset 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. |
Engaging our service will provide you enhanced control over the value of your Wellesbourne leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Last October Luca, came seriously close to the eighty-year mark with the lease on his basement apartment in Wellesbourne. Having purchased his flat twenty years previously, the length of the lease was of little interest. Thankfully, he recognised he would soon be paying an inflated amount for a lease extension. Luca extended the lease at the eleventh hour last June. Luca and the freeholder via the managing agents in the end settled on a premium of £6,000 . If the lease had slid lower than eighty years, the amount would have escalated by at least £975.
Mr and Mrs. H Girard bought a recently refurbished flat in Wellesbourne in June 2004. We are asked if we could shed any light on how much (roughly) price would likely be for a 90 year lease extension. Identical homes in Wellesbourne with a long lease were worth £285,000. The mid-range ground rent payable was £45 collected per annum. The lease termination date was in 2097. Given that there were 72 years remaining we estimated the compensation to the freeholder for the lease extension to be within £12,400 and £14,200 not including expenses.
Last month we were approach by Mr Owen Wright , who bought a studio flat in Wellesbourne in November 1998. We are asked if we could shed any light on how much (approximately) price would likely be for a ninety year extension to my lease. Identical premises in Wellesbourne with an extended lease were in the region of £233,200. The mid-range ground rent payable was £60 billed monthly. The lease elapsed on 8 June 2086. Given that there were 61 years remaining we calculated the premium to the landlord for the lease extension to be between £22,800 and £26,400 not including professional charges.