Much Wenlock residential property owned on a long lease is a depreciating asset as the leaseholder only owns the property for a set term.
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 35 years unexpired, the premises will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Yorkshire 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. |
Lease extensions in Much Wenlock can be a difficult process. We recommend you get guidance from a conveyancer and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Much Wenlock lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
After lengthy discussions with the landlord of her purpose-built flat in Much Wenlock, Freya initiated the lease extension process just as her lease was nearing the crucial eighty-year deadline. The transaction completed in June 2008. The landlord’s charges were negotiated to a tad over 450 GBP.
In 2013 we were e-mailed by Mr and Mrs. H Wilson who, having bought a one bedroom apartment in Much Wenlock in November 2002. The dilemma was if we could estimate the compensation to the landlord would be for a ninety year extension to my lease. Identical properties in Much Wenlock with a long lease were in the region of £280,000. The mid-range amount of ground rent was £55 invoiced per annum. The lease came to a finish in 2103. Taking into account 77 years unexpired we estimated the premium to the freeholder to extend the lease to be within £13,300 and £15,400 exclusive of costs.
In 2012 we were e-mailed by Mr and Mrs. U Clark who, having took over the lease of a one bedroom flat in Much Wenlock in July 1998. The dilemma was if we could shed any light on how much (roughly) premium could be to prolong the lease by ninety years. Identical premises in Much Wenlock with 100 year plus lease were in the region of £183,600. The mid-range amount of ground rent was £65 billed per annum. The lease expired on 23 September 2083. Considering the 57 years remaining we calculated the premium to the freeholder for the lease extension to be between £28,500 and £33,000 exclusive of expenses.