Walkington leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Walkington residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Walkington you really ought to see if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under 80 years, the cost of any lease extension increases dramatically as an element of the premium you pay is what is known as a marriage value
It is conventional wisdom that a residential leasehold with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to any lease with more than 30 years remaining, the premises will be worth the same as a freehold for many years ahead.
| 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. |
| 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
The lawyers that we work with undertake 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 conveyancing solicitor we work with provide it.
18 months ago Noah, came critically near to the 80-year threshold with the lease on his garden apartment in Walkington. In buying his home twenty years ago, the length of the lease was of minimal relevance. Thankfully, he realised he needed to take action soon on Extending the lease. Noah extended the lease just under the wire in August. Noah and the freeholder subsequently settled on the final figure of £5,000 . If he not met the deadline, the amount would have become more exhorbitant by at least £1,025.
Mr Kyle Bailey took over the lease of a basement apartment in Walkington in May 1999. We are asked if we could shed any light on how much (roughly) price would likely be to prolong the lease by an additional years. Identical homes in Walkington with an extended lease were worth £257,800. The mid-range amount of ground rent was £65 invoiced quarterly. The lease lapsed on 18 April 2091. Given that there were 65 years remaining we estimated the premium to the landlord for the lease extension to be within £18,100 and £20,800 not including fees.
Last month we were e-mailed by Mr and Mrs. B Parker , who moved into a one bedroom flat in Walkington in May 2006. The question was if we could estimate the price could be for a ninety year lease extension. Comparative properties in Walkington with 100 year plus lease were valued around £191,400. The average ground rent payable was £55 collected per annum. The lease terminated on 4 April 2080. Taking into account 54 years outstanding we calculated the premium to the freeholder for the lease extension to be within £34,200 and £39,600 plus costs.