It’s a harsh certainty that a Wisbech residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the Wisbech property prices.Where your lease has approximately 90 years left, you should start thinking about 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 dips lower than 80 years - otherwise a higher premium will be payable. Most flat owners in Wisbech will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you are eligibility. In some situations you may not be entitled. There are also strict timeframes and procedures to follow once the process has commenced and you will need to be guided by your conveyancer for the duration of the process.
It is generally accepted that a property with over 100 years remaining is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
Retaining our service gives you better control over the value of your Wisbech leasehold, as your property will be more valuable and saleable in terms of lease length should you want 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 Nathan, started to get near to the eighty-year mark with the lease on his garden flat in Wisbech. In buying his flat two decades ago, the lease term was of minimal importance. by good luck, he realised he needed to take action soon on a lease extension. Nathan extended the lease just ahead of time in July. Nathan and the landlord who owned the flat above subsequently settled on a premium of £5,500 . If he had missed the deadline, the amount would have escalated by a minimum £950.
Mr and Mrs. K André moved into a one bedroom flat in Wisbech in November 2005. The question was if we could approximate the price would be to prolong the lease by an additional years. Comparative properties in Wisbech with 100 year plus lease were valued about £232,800. The mid-range amount of ground rent was £45 collected every twelve months. The lease came to a finish on 15 September 2090. Having 65 years as a residual term we calculated the premium to the landlord to extend the lease to be within £13,300 and £15,400 not including costs.
In 2012 we were called by Mr and Mrs. N Anderson who, having bought a one bedroom flat in Wisbech in June 2010. The question was if we could shed any light on how much (approximately) price would be for a ninety year lease extension. Similar flats in Wisbech with an extended lease were in the region of £275,000. The average amount of ground rent was £55 billed yearly. The lease elapsed on 18 July 2101. Given that there were 76 years outstanding we estimated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 exclusive of fees.