The market value of a leasehold property in Woodford Green is impacted by how long the lease has remaining. If it is close to or fewer than eighty years you should expect difficulties on re-sale, so it is recommended to arrange for a lease extension prior to purchasing. It is preferable to commence the process of extending the lease is when the lease still has 82 years to run so that a lease extension can be concluded well before the 80 year mark. Leasehold Reform legislation entitles Woodford Green 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 determine the sum payable by the lessee to the freeholder for the acquisition of the lease extension.
It is conventional wisdom that a property with over one hundred years remaining is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 30 years left, 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a landlord in Woodford Green,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Woodford Green valuers.
In recent months Caleb, came seriously close to the 80-year threshold with the lease on his two bedroom flat in Woodford Green. In buying his flat 18 years ago, the lease term was of no importance. Fortunately, he noticed he needed to take action soon on a lease extension. Caleb was able to extend his lease at the eleventh hour last March. Caleb and the freeholder subsequently settled on a premium of £6,000 . If the lease had slipped to less than 80 years, the figure would have become more costly by at least £1,025.
Mr and Mrs. A Collins bought a recently refurbished flat in Woodford Green in August 2001. The question was if we could approximate the price would likely be for a 90 year lease extension. Comparative properties in Woodford Green with a long lease were in the region of £290,000. The mid-range amount of ground rent was £45 collected every twelve months. The lease finished on 8 February 2098. Having 73 years remaining we estimated the premium to the landlord for the lease extension to be within £8,600 and £9,800 exclusive of fees.
An example of a Freehold Enfranchisement case for a Woodford Green premises is 201 & 201a St. Barnabas Road in October 2013. The Tribunal decided that the price to be paid by the Applicants for the freehold interest is £20,071. This case related to 2 flats. The unexpired residue of the current lease was 69.26 years.