It’s a harsh truth that a Wood Green residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the Wood Green property prices.Once your lease gets to 85ish years, 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 falls under 80 years - otherwise a higher premium will be due. Most flat owners in Wood Green will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you are eligibility. In some cases you may not qualify. There are also strict deadlines and procedures to be adhered to once the process is initiated and you will need to be guided by your lawyer throughout the formalities.
It is generally accepted that a property with more than 100 years remaining is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years ahead.
| 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 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
Using our service gives you better control over the value of your Wood Green leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Last year Charlie, started to get close to the eighty-year threshold with the lease on his purpose- built apartment in Wood Green. Having purchased his flat two decades ago, the lease term was of minimal bearing. by good luck, he recognised he needed to take steps soon on a lease extension. Charlie arranged for a lease extension just under the wire last April. Charlie and the freeholder via the management company ultimately settled on an amount of £5,000 . If the lease had slipped to less than eighty years, the figure would have increased by at least £1,000.
Last month we were e-mailed by Mr and Mrs. B Moore , who was assigned a lease of a purpose-built apartment in Wood Green in October 1996. The dilemma was if we could estimate the price would likely be for a ninety year lease extension. Similar flats in Wood Green with a long lease were worth £260,000. The mid-range amount of ground rent was £50 invoiced per annum. The lease terminated on 23 May 2096. Given that there were 72 years left we calculated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 not including legals.
An example of a Lease Extension decision for a Wood Green premises is First Floor Flat 109 Lyndhurst Road in May 2010. Following a vesting order by Edmonton County Court on 29th October 2009 the Tribunal decided on a figure of £5,012 for a lease extension. This case affected 1 flat. The remaining number of years on the lease was 81.79 years.