It’s a harsh truth that a Wanstead Flats residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Wanstead Flats property market.Where your lease has approximately 90 years left, you need to start thinking about a lease extension. If the number of years remaining slips below eighty years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most leasehold owners in Wanstead Flats will be able to extend under the legislation; however a conveyancer 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 follow once the process is initiated and you will need to be guided by your conveyancer for the duration of the process.
It is conventional wisdom that a property with over 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
The conveyancing solicitors that we work with undertake Wanstead Flats 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 conveyancer we work with provide it.
Last October Milo, started to get near to the 80-year threshold with the lease on his basement apartment in Wanstead Flats. Having purchased his flat 18 years previously, the length of the lease was of minimal bearing. Luckily, it dawned on him that he would imminently be paying way over the odds for Extending the lease. Milo arranged for a lease extension just ahead of time in March. Milo and the freeholder via the managing agents eventually agreed on sum of £6,000 . If he had missed the deadline, the figure would have increased by at least £975.
Last Spring we were phoned by Mr Lucas Rodríguez , who moved into a purpose-built apartment in Wanstead Flats in April 2011. We are asked if we could shed any light on how much (roughly) price would be to extend the lease by ninety years. Comparable residencies in Wanstead Flats with a long lease were worth £225,400. The mid-range ground rent payable was £45 collected every twelve months. The lease finished on 17 July 2090. Considering the 64 years unexpired we estimated the premium to the landlord for the lease extension to be within £16,200 and £18,600 not including costs.
In 2012 we were approached by Mr and Mrs. P Martínez who, having owned a one bedroom apartment in Wanstead Flats in June 2001. The dilemma was if we could shed any light on how much (approximately) premium would be to prolong the lease by an additional years. Comparable homes in Wanstead Flats with an extended lease were worth £270,000. The average amount of ground rent was £55 collected quarterly. The lease expired in 2101. Given that there were 75 years remaining we approximated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 not including expenses.