Chances are that if you own a flat in St Werburghs you actually own a long leasehold interest over your property
Leasehold premises in St Werburghs with in excess of one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges merit 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. |
| 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. |
| 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. |
The conveyancers that we work with procure St Werburghs 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 conveyancer we work with provide it.
During the course of the last few months Dylan, started to get near to the 80-year mark with the lease on his studio flat in St Werburghs. Having bought his property 19 years ago, the unexpired term was of minimal importance. Luckily, he noticed he would soon be paying way over the odds for Extending the lease. Dylan extended the lease just ahead of time last July. Dylan and the freeholder via the management company eventually agreed on an amount of £6,000 . If the lease had slipped to less than eighty years, the amount would have become more costly by a minimum £1,000.
In 2010 we were e-mailed by Mr and Mrs. W Evans who, having completed a studio flat in St Werburghs in January 2011. The dilemma was if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Comparable residencies in St Werburghs with a long lease were in the region of £205,000. The mid-range amount of ground rent was £50 billed annually. The lease came to a finish in 2104. Given that there were 79 years outstanding we calculated the premium to the freeholder to extend the lease to be between £8,600 and £9,800 not including costs.
Mrs H Gray took over the lease of a first floor flat in St Werburghs in July 1999. We are asked if we could estimate the compensation to the landlord could be for a 90 year extension to my lease. Identical residencies in St Werburghs with a long lease were worth £275,000. The mid-range amount of ground rent was £65 collected per annum. The lease lapsed in 2093. Given that there were 68 years remaining we approximated the compensation to the landlord to extend the lease to be between £12,400 and £14,200 exclusive of costs.