Wareham leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. Legislation has been in place for sometime now which entitles qualifying Wareham residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Wareham you should investigate if your lease has between seventy and 90 years remaining. There are good reasons why a Wareham flat owner with a lease having around eighty years unexpired should take action to make sure that a lease extension is actioned without delay
It is generally accepted that a property with more than one hundred years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 30 years unexpired, the property will be equivalent in value to a freehold for decades to come.
| 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; |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
Irrespective of whether you are a tenant or a freeholder in Wareham,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Wareham valuers.
James owned a studio apartment in Wareham being sold with a lease of a little over 72 years remaining. James on an informal basis spoke with his landlord being a well known Bristol-based freehold company for a lease extension. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent at the outset set at £200 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were James to exercise his statutory right. James obtained expert legal guidance and was able to make an informed judgement and handle with the matter and ending up with a market value flat.
Last year we were phoned by Mrs Mollie Rogers , who took over the lease of a first floor flat in Wareham in May 2000. We are asked if we could shed any light on how much (roughly) price would likely be to extend the lease by a further 90 years. Identical flats in Wareham with an extended lease were in the region of £225,800. The average amount of ground rent was £60 invoiced per annum. The lease ran out in 2085. Considering the 60 years unexpired we approximated the compensation to the landlord to extend the lease to be within £23,800 and £27,400 plus legals.
Mr and Mrs. L Morel owned a newly refurbished apartment in Wareham in February 2009. The question was if we could approximate the price could be for a ninety year lease extension. Comparative premises in Wareham with an extended lease were in the region of £210,000. The average ground rent payable was £50 invoiced yearly. The lease end date was on 9 April 2105. Having 80 years outstanding we approximated the premium to the landlord for the lease extension to be within £8,600 and £9,800 not including fees.