The market value of Wisbech leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can escalate substantially once the unexpired lease term is below than eighty years
It is conventional wisdom that a property with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 35 years left, the property will be worth the same as a freehold for many years ahead.
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
The conveyancers that we work with handle Wisbech 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.
During the course of the last few months Aiden, came dangerously near to the eighty-year mark with the lease on his ground floor apartment in Wisbech. Having bought his property 19 years previously, the lease term was of minimal significance. Fortunately, he recognised he needed to take steps soon on Extending the lease. Aiden arranged for a lease extension at the eleventh hour last August. Aiden and the freeholder via the management company ultimately settled on a premium of £5,500 . If he had missed the deadline, the sum would have increased by at least £900.
Last August we were phoned by Mr Aaron Bonnet , who completed a recently refurbished flat in Wisbech in November 1995. We are asked if we could shed any light on how much (roughly) premium would likely be for a 90 year lease extension. Identical properties in Wisbech with an extended lease were valued around £246,800. The mid-range amount of ground rent was £60 collected annually. The lease finished in 2076. Given that there were 50 years unexpired we approximated the compensation to the landlord to extend the lease to be within £44,700 and £51,600 not including professional charges.
Mrs M Harris was assigned a lease of a garden apartment in Wisbech in February 2011. We are asked if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Comparable residencies in Wisbech with an extended lease were in the region of £208,200. The average ground rent payable was £65 invoiced monthly. The lease finished on 22 January 2087. Taking into account 61 years unexpired we calculated the premium to the freeholder to extend the lease to be within £20,000 and £23,000 not including legals.