Winchcombe residential property held on a long lease is a depreciating asset as the leaseholder only owns the property for a set term.
It is generally accepted that a residential leasehold with in excess of 100 years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 45 years unexpired, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with procure Winchcombe 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.
In recent months Austin, came very close to the 80-year threshold with the lease on his one bedroom apartment in Winchcombe. In buying his home 18 years ago, the length of the lease was of no significance. by good luck, he noticed he would imminently be paying an inflated amount for Extending the lease. Austin arranged for a lease extension just in the nick of time last June. Austin and the freeholder via the management company ultimately agreed on the final figure of £6,000 . If he failed to meet the deadline, the price would have become more exhorbitant by at least £1,000.
Mr and Mrs. A Smith purchased a ground floor apartment in Winchcombe in September 2001. The dilemma was if we could shed any light on how much (approximately) premium could be for a ninety year extension to my lease. Comparable residencies in Winchcombe with 100 year plus lease were valued around £275,000. The average amount of ground rent was £45 invoiced quarterly. The lease terminated in 2095. Given that there were 69 years outstanding we estimated the premium to the freeholder to extend the lease to be within £12,400 and £14,200 plus fees.
Mr and Mrs. L Miller owned a studio apartment in Winchcombe in March 2007. We are asked if we could approximate the compensation to the landlord could be for a 90 year lease extension. Comparable homes in Winchcombe with a long lease were worth £216,000. The mid-range amount of ground rent was £60 billed annually. The lease terminated on 4 February 2084. Given that there were 58 years remaining we estimated the premium to the freeholder for the lease extension to be between £28,500 and £33,000 exclusive of legals.