Waterbeach leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. It is the case that most Waterbeach tenants have the right to extend their lease by an additional ninety years by virtue of the 1993 Leasehold Reform Act. Where you are a leasehold owner in Waterbeach you really ought to check if your lease has between seventy and ninety years left. There are compelling reasons why a Waterbeach flat owner with a lease having around 80 years remaining should take action to make sure that a lease extension is effected without delay
Leasehold premises in Waterbeach with in excess of 100 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 freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Chelsea 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with undertake Waterbeach 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 lawyer we work with provide it.
In the wake of 9 months of protracted correspondence with the landlord of her leasehold flat in Waterbeach, Jasmine started the lease extension process as the eighty year deadline was rapidly advancing. The transaction was finalised in April 2008. The landlord’s fees were kept to an absolute minimum.
Last April we were e-mailed by Ms B Garcia , who owned a first floor flat in Waterbeach in June 2006. We are asked if we could shed any light on how much (approximately) premium would be for a 90 year extension to my lease. Identical residencies in Waterbeach with an extended lease were worth £275,000. The mid-range amount of ground rent was £55 billed annually. The lease concluded in 2101. Having 76 years left we calculated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 not including professional charges.
In 2011 we were contacted by Mrs B López who, having was assigned a lease of a ground floor apartment in Waterbeach in July 2003. We are asked if we could estimate the compensation to the landlord would likely be for a 90 year extension to my lease. Similar homes in Waterbeach with an extended lease were worth £176,200. The mid-range amount of ground rent was £65 collected per annum. The lease concluded in 2081. Taking into account 56 years outstanding we estimated the premium to the freeholder for the lease extension to be between £29,500 and £34,000 exclusive of fees.