The market value of Wanstead 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 increase substantially once the remaining term is below than eighty years
Leasehold properties in Wanstead with more than 100 years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| 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 |
The conveyancers that we work with undertake Wanstead 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.
Rory owned a 2 bedroom apartment in Wanstead on the market with a lease of a few days over fifty eight years outstanding. Rory informally spoke with his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a rise in the rent to £50 per annum. Ordinarily, ground rent would not be payable on a lease extension were Rory to exercise his statutory right. Rory procured expert legal guidance and was able to make a more informed judgement and deal with the matter and readily saleable.
Last month we were phoned by Mr and Mrs. F Martin , who acquired a garden apartment in Wanstead in July 2009. The dilemma was if we could shed any light on how much (approximately) premium could be to extend the lease by ninety years. Similar homes in Wanstead with 100 year plus lease were in the region of £206,200. The mid-range amount of ground rent was £60 invoiced yearly. The lease elapsed on 4 October 2081. Having 56 years remaining we estimated the premium to the landlord for the lease extension to be between £31,400 and £36,200 exclusive of legals.
An example of a Freehold Enfranchisement decision for a Wanstead residence is 36 New Wanstead in August 2010. The Tribunal arrived at a valuation of the premium for the freehold of £22,359. This case was in relation to 2 flats. The number of years remaining on the existing lease(s) was 73.92 years.