The market value of a leasehold property in Wisbech depends on how many years the lease has left to run. If it is close to or less than eighty years you should foresee difficulties on re-sale, so it is advisable to arrange for a lease extension before purchasing. It is preferable to commence the process of extending the lease is when the lease still has 82 years unexpired so that formalities can be finalised ahead of the eighty year threshold. Statute entitles Wisbech qualifying lessees to obtain a lease extension of ninety years in addition to the remaining length of the lease at a peppercorn rent (that is, rent free). The purpose of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold premises in Wisbech with in excess of 100 years unexpired 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 property. In such situations there is often little upside in buying the freehold unless savings on ground rent and maintenance charges warrant it.
| 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. |
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service gives you increased control over the value of your Wisbech leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to unsuccessful correspondence with the landlord of her leasehold flat in Wisbech, Nicole initiated the lease extension process as the 80 year deadline was fast approaching. The lease extension was finalised in July 2006. The freeholder’s fees were kept to an absolute minimum.
In 2011 we were contacted by Dr Ollie Jones who, having acquired a purpose-built flat in Wisbech in February 1995. The dilemma was if we could shed any light on how much (roughly) premium would likely be for a ninety year lease extension. Similar flats in Wisbech with a long lease were worth £285,000. The average amount of ground rent was £55 collected annually. The lease lapsed in 2105. Considering the 79 years left we approximated the premium to the freeholder for the lease extension to be between £13,300 and £15,400 not including costs.
Last month we were phoned by Mr Edward Petit , who purchased a one bedroom flat in Wisbech in July 2001. The dilemma was if we could shed any light on how much (roughly) premium would likely be for a ninety year lease extension. Comparative premises in Wisbech with 100 year plus lease were in the region of £193,400. The average amount of ground rent was £65 invoiced monthly. The lease came to a finish in 2085. Having 59 years unexpired we calculated the compensation to the freeholder for the lease extension to be between £21,900 and £25,200 exclusive of costs.