There is no doubt about it a leasehold flat or house in Wimbledon is a wasting asset as a result of the shortening lease. If the lease has, beyond one hundred years remaining then this decrease may be of little impact however there will become a stage when a lease has less than eighty years left as part of the premium you will incur is what is known as a marriage value. This could increase markedly the cost. It is the main rational as to why you should consider extending sooner as opposed to later. Many flat owners in Wimbledon will meet the qualifying criteria; that being said a conveyancer will be able to advise whether you qualify for a lease extension. In limited situations you may not qualify, the most frequent reason being that you have owned the property for under two years.
It is generally considered that a property with more than 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years remaining, the premises will be worth the same as a freehold for many years in the future.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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 |
The conveyancers that we work with undertake Wimbledon 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.
Last Christmas Reuben, came very close to the 80-year threshold with the lease on his garden apartment in Wimbledon. Having bought his flat two decades ago, the length of the lease was of no interest. As luck would have it, it dawned on him that he would soon be paying an escalated premium for Extending the lease. Reuben was able to extend his lease just under the wire last August. Reuben and the freeholder via the management company ultimately settled on a premium of £6,000 . If the lease had slid lower than 80 years, the figure would have become more exhorbitant by at least £975.
Mr and Mrs. A Davis completed a one bedroom flat in Wimbledon in July 2012. We are asked if we could approximate the premium would be for a ninety year extension to my lease. Identical premises in Wimbledon with a long lease were in the region of £275,000. The average ground rent payable was £65 billed per annum. The lease finished in 2094. Taking into account 68 years as a residual term we calculated the compensation to the freeholder to extend the lease to be within £12,400 and £14,200 not including professional charges.
An example of a Freehold Enfranchisement case for a Wimbledon flat is 629 Garratt Lane in September 2014. The consideration payable for the acquisition of the freehold of the subject property was the sum £21,302.74. This represented a valuation of the freehold in the sum of £23,864 from which the sum of £2561.27 has been deducted in respect of certain costs in repairing and insuring the premises This case related to 3 flats. The unexpired lease term was 72.94 years.