Walkington leases on residential properties are gradually losing value. if your lease has about 90 years remaining, you should start thinking about a lease extension. If lease term is less than eighty years, you will then have to pay half of the property's 'marriage value' in addition to the standard cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Flat owners in Walkington will mostly be legally entitled to a lease extension; however It would be wise to check with a lawyer to confirm if you qualify. In some situations you may not qualify. There are also strict deadlines and formalities to follow once the process is triggered so it’s best to be guided by a lawyer during the process.
It is conventional wisdom that a property with more than one hundred years remaining is worth approximately the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| 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 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 conveyancing solicitor we work with provide it.
Subsequent to unsuccessful negotiations with the freeholder of her studio apartment in Walkington, Laura commenced the lease extension process just as the lease was coming close to the critical 80-year deadline. The transaction completed in March 2005. The landlord’s charges were negotiated to about 600 GBP.
In 2014 we were called by Ms Phoebe Wood who, having moved into a first floor flat in Walkington in March 2008. We are asked if we could estimate the price would be for a 90 year lease extension. Comparative flats in Walkington with an extended lease were in the region of £300,000. The average amount of ground rent was £50 invoiced monthly. The lease concluded in 2100. Considering the 75 years outstanding we estimated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 not including legals.
Mr and Mrs. I Clark owned a studio apartment in Walkington in June 2009. We are asked if we could approximate the price would be to prolong the lease by 90 years. Comparable homes in Walkington with 100 year plus lease were valued around £250,400. The mid-range amount of ground rent was £65 collected yearly. The lease concluded in 2089. Having 64 years left we estimated the premium to the freeholder to extend the lease to be within £19,000 and £22,000 plus expenses.