With a domestic leasehold property in Warwick, you are actually purchasing an entitlement to reside in a property for a set period of time. In recent years flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you should think about a lease extension sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease becomes disproportionately more expensive especially when there are less than 80 years remaining. Anyone in Warwick with a lease approaching 81 years left should seriously think of extending it without delay. Once a lease has fewer than 80 years left, under the current legislation the landlord is entitled to calculate and charge a greater premium, based on a technical multiplication, strangely termed as “marriage value” which is due.
It is generally accepted that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to any lease with more than 30 years left, the property will be worth the same as 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. |
| 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. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service gives you better control over the value of your Warwick leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Toby owned a 2 bedroom apartment in Warwick on the market with a lease of just over sixty years outstanding. Toby on an informal basis approached his freeholder a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to a rise in the rent to £100 annually. Ordinarily, ground rent would not be payable on a lease extension were Toby to exercise his statutory right. Toby procured expert advice and was able to make a more informed decision and handle with the matter and sell the property.
Mr and Mrs. I Hall took over the lease of a one bedroom flat in Warwick in February 1998. The question was if we could estimate the price would be for a ninety year extension to my lease. Similar premises in Warwick with 100 year plus lease were worth £205,000. The mid-range amount of ground rent was £50 collected annually. The lease came to a finish on 10 September 2104. Taking into account 78 years left we calculated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 plus fees.
In 2010 we were contacted by Dr Jade Gómez who, having took over the lease of a first floor apartment in Warwick in November 2003. We are asked if we could estimate the price could be for a ninety year extension to my lease. Comparable properties in Warwick with 100 year plus lease were valued around £267,600. The mid-range amount of ground rent was £65 billed every twelve months. The lease finished on 18 June 2093. Taking into account 67 years left we calculated the compensation to the landlord to extend the lease to be within £14,300 and £16,400 not including expenses.