It’s an underpublicised truth that a Walkington residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Walkington property prices.Once your lease gets to 85ish years, you need to start considering a lease extension. If lease term falls below 80 years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of flat owners in Walkington will be able to extend under the legislation; however a lawyer should be able to confirm if you are eligibility. In some cases you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancer from beginning to end of the formalities.
Leasehold premises in Walkington with over 100 years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges justify 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. |
| Coventry Building Society | 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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 lawyers that we work with handle Walkington 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.
Last October Cameron, started to get near to the eighty-year mark with the lease on his leasehold flat in Walkington. Having bought his property two decades ago, the unexpired term was of little bearing. Thankfully, he recognised he would imminently be paying an inflated amount for a lease extension. Cameron was able to extend his lease just under the wire in September. Cameron and the landlord ultimately settled on a premium of £6,000 . If he failed to meet the deadline, the sum would have gone up by at least £1,050.
In 2013 we were contacted by Dr A Edwards who, having took over the lease of a studio flat in Walkington in August 1999. We are asked if we could shed any light on how much (roughly) premium would likely be to extend the lease by an additional years. Identical flats in Walkington with an extended lease were in the region of £260,200. The average amount of ground rent was £65 collected quarterly. The lease elapsed on 25 September 2092. Having 66 years as a residual term we estimated the compensation to the landlord for the lease extension to be within £15,200 and £17,600 not including fees.
Last Spring we were called by Dr B Moreau , who acquired a one bedroom flat in Walkington in January 1995. The dilemma was if we could shed any light on how much (approximately) price would be to extend the lease by 90 years. Comparable properties in Walkington with 100 year plus lease were valued around £198,800. The mid-range amount of ground rent was £55 invoiced quarterly. The lease ran out on 16 June 2081. Taking into account 55 years outstanding we approximated the premium to the landlord for the lease extension to be between £33,300 and £38,400 exclusive of professional charges.