There is no doubt about it a leasehold property in Wimbledon is a wasting asset as a result of the diminishing lease term. Where the residual term has, more than one hundred years remaining then this decrease may be of little impact however there will become a point in time when a lease has under than 80 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 primary rational as to why you should extend the lease without delay. Most flat owners in Wimbledon will meet the qualifying criteria; nevertheless a conveyancer can confirm whether you are eligible to extend your lease. In certain situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold residencies in Wimbledon with in excess of one hundred years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Leeds Building Society | 85 years remaining from the start 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 lawyers that we work with handle 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 conveyancer we work with provide it.
Half a year ago Aarav, came critically close to the eighty-year threshold with the lease on his purpose- built flat in Wimbledon. Having bought his home 18 years ago, the length of the lease was of no concern. Luckily, it dawned on him that he would imminently be paying an escalated premium for a lease extension. Aarav extended the lease just in the nick of time in April. Aarav and the landlord who owned the flat above subsequently agreed on a premium of £5,500 . If he failed to meet the deadline, the sum would have increased by at least £850.
In 2010 we were phoned by Mr and Mrs. Y Cook who, having was assigned a lease of a studio apartment in Wimbledon in September 1998. We are asked if we could approximate the premium would be for a 90 year extension to my lease. Comparative homes in Wimbledon with an extended lease were valued about £206,200. The mid-range amount of ground rent was £60 collected per annum. The lease came to a finish on 1 June 2082. Considering the 56 years as a residual term we calculated the compensation to the landlord for the lease extension to be within £31,400 and £36,200 not including costs.
An example of a Freehold Enfranchisement matter before the tribunal for a Wimbledon property 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 was in relation to 3 flats. The unexpired lease term was 72.94 years.