Unfortunately that a St Werburghs residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the depreciation being disguised by increases in the St Werburghs property market.Where your lease has approximately 90 years left, you should start thinking about a lease extension. If the number of years remaining slips under 80 years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property Most flat owners in St Werburghs will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify if you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the process.
Leasehold properties in St Werburghs with in excess of 100 years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service 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. |
| 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 | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Using our service gives you increased control over the value of your St Werburghs leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last year James, came seriously near to the 80-year mark with the lease on his one bedroom flat in St Werburghs. Having purchased his home 18 years ago, the lease term was of little interest. Thankfully, he recognised he needed to take steps soon on Extending the lease. James extended the lease at the eleventh hour in April. James and the landlord who owned the flat above in the end settled on the final figure of £6,000 . If he not met the deadline, the figure would have become more costly by at least £1,025.
Mr Mason Fournier acquired a one bedroom flat in St Werburghs in September 2012. We are asked if we could estimate the compensation to the landlord would be to prolong the lease by 90 years. Comparable homes in St Werburghs with an extended lease were valued about £280,000. The average amount of ground rent was £45 invoiced yearly. The lease expired in 2096. Taking into account 70 years as a residual term we estimated the premium to the landlord to extend the lease to be within £12,400 and £14,200 not including costs.
In 2011 we were e-mailed by Ms Elizabeth Taylor who, having moved into a ground floor apartment in St Werburghs in April 2003. The dilemma was if we could estimate the premium could be for a 90 year lease extension. Comparative homes in St Werburghs with an extended lease were valued around £223,400. The mid-range amount of ground rent was £60 collected per annum. The lease terminated on 18 May 2085. Considering the 59 years left we approximated the compensation to the freeholder for the lease extension to be within £27,600 and £31,800 plus costs.