Chances are that where you own a flat in Woodley you actually own a long leasehold interest over your property
It is generally accepted that a residential leasehold with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 30 years unexpired, the property will be equivalent in value to a freehold for decades to come.
| 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | 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 |
The conveyancing solicitors 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 lawyer we work with provide it.
After unsuccessful correspondence with the landlord of her basement flat in Woodley, Paige initiated the lease extension process just as the lease was approaching the critical eighty-year deadline. The lease extension was concluded in October 2005. The freeholder’s fees were kept to an absolute minimum.
Last month we were called by Mr and Mrs. K Wood , who took over the lease of a newly refurbished flat in Woodley in May 2009. The question was if we could approximate the price could be for a ninety year extension to my lease. Comparable homes in Woodley with 100 year plus lease were in the region of £290,000. The average amount of ground rent was £60 billed monthly. The lease terminated in 2105. Having 80 years outstanding we calculated the premium to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of professional charges.
In 2012 we were contacted by Ms Sophia Bell who, having completed a one bedroom flat in Woodley in September 1998. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be for a 90 year lease extension. Identical flats in Woodley with an extended lease were worth £200,800. The mid-range ground rent payable was £65 invoiced quarterly. The lease expiry date was on 6 March 2085. Taking into account 60 years remaining we approximated the premium to the freeholder for the lease extension to be between £20,900 and £24,200 plus costs.