The market value of Walkington leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can escalate materialy once the unexpired lease term is less than eighty years
Leasehold properties in Walkington with in excess of 100 years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and maintenance 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. |
| 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 75 years plus the term of the mortgage at the outset of the mortgage. |
The conveyancing solicitors 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.
Two years ago Joshua, came precariously near to the 80-year threshold with the lease on his two bedroom flat in Walkington. Having purchased his flat 18 years previously, the length of the lease was of little interest. by good luck, he became aware that he would soon be paying an escalated premium for a lease extension. Joshua extended the lease just under the wire in June. Joshua and the landlord who owned the flat above eventually agreed on a premium of £6,000 . If the lease had slipped lower than 80 years, the sum would have increased by a minimum £1,150.
Last Christmas we were e-mailed by Mr and Mrs. T Carter , who completed a one bedroom flat in Walkington in April 2004. We are asked if we could estimate the price could be for a 90 year extension to my lease. Comparable flats in Walkington with an extended lease were worth £210,000. The average ground rent payable was £50 billed quarterly. The lease expired on 16 October 2106. Having 80 years outstanding we calculated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 exclusive of legals.
Last year we were approach by Ms H Williams , who took over the lease of a basement flat in Walkington in January 2003. The dilemma was if we could estimate the premium could be to prolong the lease by a further 90 years. Similar flats in Walkington with a long lease were worth £280,000. The average amount of ground rent was £45 invoiced annually. The lease elapsed in 2095. Taking into account 69 years as a residual term we approximated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 not including legals.