Woodley leases on domestic deteriorating in value. Where your lease has approximately ninety years left, you should start considering the need for a lease extension. If lease term is less than eighty years, you will then have to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Flat owners in Woodley will mostly be legally entitled to a lease extension; however it’s a good idea to check with a lawyer to check your eligibility. In some situations you may not qualify. There are prescribed timetables and procedures to follow once the process has started so it’s best to be guided by a conveyancer during the process.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 35 years left, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| Godiva Mortgages | 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with procure Woodley lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancing solicitor we work with provide it.
Seth owned a 2 bedroom flat in Woodley on the market with a lease of a few days over 59 years remaining. Seth informally approached his freeholder being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years subject to a new rent at the outset set at £200 per annum and doubled every twenty five years thereafter. No ground rent would be payable on a lease extension were Seth to exercise his statutory right. Seth procured expert advice and secured satisfactory deal informally and readily saleable.
In 2010 we were phoned by Mrs Holly Bernard who, having was assigned a lease of a one bedroom flat in Woodley in March 1996. The question was if we could approximate the premium would be to extend the lease by ninety years. Similar residencies in Woodley with a long lease were valued around £166,400. The average ground rent payable was £60 billed every twelve months. The lease elapsed on 6 July 2080. Given that there were 54 years outstanding we approximated the compensation to the landlord for the lease extension to be within £32,300 and £37,400 plus legals.
Last Summer we were e-mailed by Dr Seth Young , who completed a recently refurbished flat in Woodley in October 2007. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be for a ninety year lease extension. Similar homes in Woodley with an extended lease were in the region of £227,800. The average amount of ground rent was £45 collected yearly. The lease came to a finish in 2091. Having 65 years remaining we estimated the premium to the freeholder for the lease extension to be between £13,300 and £15,400 not including professional charges.