Owning a flat usually means owning a lease of the property, which has a set term of years. The lease will ordinarily be granted for a set period of time , usually 99 or 125 years, although we have witnessed longer and shorter terms in Woodford. Inevitably, the length of lease remaining shortens over time. This may pass by relatively unnoticed when the residence has to be disposed of or refinanced. The shorter the lease the lower the value of the property and the more expensive it will be to obtain a lease extension. Qualifying long lease owners in Woodford have the legal entitlement to extend the lease for a further ninety years under legislation. Do give careful attention before putting off your Woodford lease extension. Holding off that expense now simply increases the price you will eventually have to pay to extend your lease
Leasehold residencies in Woodford with more than one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and maintenance charges justify 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Engaging our service will provide you enhanced control over the value of your Woodford leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
18 months ago Adam, started to get close to the 80-year mark with the lease on his studio flat in Woodford. Having purchased his flat two decades ago, the length of the lease was of minimal interest. As luck would have it, he noticed he needed to take action soon on Extending the lease. Adam extended the lease at the eleventh hour in January. Adam and the landlord who owned the flat above eventually agreed on a premium of £6,000 . If he failed to meet the deadline, the amount would have escalated by a minimum £900.
Last Spring we were contacted by Mrs R Sharif , who took over the lease of a garden flat in Woodford in January 2003. The dilemma was if we could shed any light on how much (roughly) premium could be for a ninety year lease extension. Comparable homes in Woodford with an extended lease were worth £189,000. The mid-range amount of ground rent was £55 collected monthly. The lease came to a finish on 20 March 2078. Having 53 years as a residual term we approximated the compensation to the landlord for the lease extension to be within £28,500 and £33,000 exclusive of costs.
An example of a Freehold Enfranchisement case for a Woodford property 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 affected 2 flats. The unexpired residue of the current lease was 69.26 years.