Watnall 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. Legislation has been in place for sometime now allowing qualifying Watnall residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Watnall you really ought to investigate if your lease has between 70 and 90 years left. In particular once the remaining lease term slips under 80 years, the amount payable for any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
Leasehold premises in Watnall with more than one hundred 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 home. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges warrant 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Retaining our service gives you better control over the value of your Watnall leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Gabriel was the the leasehold owner of a high value apartment in Watnall being sold with a lease of a few days over 61 years unexpired. Gabriel on an informal basis spoke with his freeholder being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a rise in the rent to £200 yearly. No ground rent would be payable on a lease extension were Gabriel to exercise his statutory right. Gabriel obtained expert legal guidance and was able to make a more informed decision and deal with the matter and ending up with a market value flat.
In 2013 we were phoned by Mr and Mrs. L Edwards who, having owned a newly refurbished flat in Watnall in February 2008. The question was if we could estimate the price would likely be to prolong the lease by ninety years. Comparable premises in Watnall with an extended lease were valued around £242,600. The average amount of ground rent was £45 invoiced monthly. The lease concluded on 5 February 2093. Having 67 years outstanding we estimated the compensation to the freeholder for the lease extension to be within £11,400 and £13,200 not including costs.
In 2011 we were called by Mr S Roberts who, having bought a ground floor apartment in Watnall in June 2004. We are asked if we could approximate the compensation to the landlord would likely be to extend the lease by a further 90 years. Similar flats in Watnall with 100 year plus lease were worth £280,000. The average ground rent payable was £55 collected monthly. The lease came to a finish on 11 March 2104. Given that there were 78 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 not including costs.