Walkington leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. Legislation has been in place for sometime now which entitles qualifying Walkington residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Walkington you must check if your lease has between 70 and ninety years left. There are good reasons why a Walkington flat owner with a lease having around 80 years remaining should take steps to ensure that a lease extension is effected without delay
Leasehold residencies in Walkington with more than 100 years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| 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; |
| Chelsea 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. |
| 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. |
| Halifax | Minimum 70 years from the date 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. |
Engaging our service gives you increased control over the value of your Walkington leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Charlie, came perilously near to the eighty-year mark with the lease on his first floor apartment in Walkington. In buying his home two decades ago, the unexpired term was of minimal concern. by good luck, he noticed he would soon be paying way over the odds for Extending the lease. Charlie arranged for a lease extension just in the nick of time last March. Charlie and the freeholder eventually settled on the final figure of £5,000 . If the lease had fallen below 80 years, the sum would have increased by a minimum £925.
Last February we were called by Mr and Mrs. N Martinez , who took over the lease of a one bedroom apartment in Walkington in May 1996. We are asked if we could approximate the price would be for a 90 year lease extension. Comparable properties in Walkington with 100 year plus lease were in the region of £260,200. The average ground rent payable was £65 invoiced annually. The lease expiry date was on 6 September 2091. Considering the 66 years remaining we calculated the compensation to the freeholder to extend the lease to be within £15,200 and £17,600 not including costs.
Last year we were e-mailed by Dr O Turner , who bought a purpose-built flat in Walkington in February 2010. We are asked if we could estimate the price would likely be to extend the lease by ninety years. Comparable premises in Walkington with a long lease were valued around £198,800. The mid-range amount of ground rent was £55 invoiced monthly. The lease concluded in 2080. Taking into account 55 years remaining we calculated the premium to the landlord for the lease extension to be between £33,300 and £38,400 not including costs.