It’s an underpublicised truth that a Wandsworth residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the Wandsworth property market.Once your lease gets to 85ish years, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips lower than 80 years - otherwise a higher amount will be due. Most flat owners in Wandsworth will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify whether you qualify for an extension. In some situations you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancing solicitor for the duration of the formalities.
Leasehold properties in Wandsworth with more than one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Using our service gives you increased control over the value of your Wandsworth leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Jayden was the the leasehold proprietor of a conversion flat in Wandsworth on the market with a lease of a little over 61 years outstanding. Jayden on an informal basis contacted his landlord a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £50 yearly. No ground rent would be due on a lease extension were Jayden to invoke his statutory right. Jayden procured expert legal guidance and was able to make an informed judgement and deal with the matter and readily saleable.
In 2011 we were e-mailed by Dr Louise Parker who, having moved into a basement flat in Wandsworth in January 2010. The dilemma was if we could approximate the price would be to extend the lease by a further 90 years. Similar residencies in Wandsworth with 100 year plus lease were worth £270,000. The mid-range ground rent payable was £55 collected quarterly. The lease terminated on 3 October 2100. Taking into account 75 years unexpired we approximated the premium to the landlord for the lease extension to be between £9,500 and £11,000 plus professional charges.
An example of a Freehold Enfranchisement matter before the tribunal for a Wandsworth premises is 4 Galveston Road in August 2012. The Tribunal determined that the price payable in respect of the purchase of the freehold was £22,650. The Tribunal remited this matter back to the Wandsworth County Court for execution of the freehold Transfer Deed. This case related to 2 flats.