The value of Wedmore leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can increase significantly once the unexpired lease term is less than 80 years
It is generally considered that a property with more than one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| 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. |
| 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 |
Engaging our service gives you enhanced control over the value of your Wedmore leasehold, as your property will be more valuable and saleable in respect of lease length should you decide to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of protracted correspondence with the freeholder of her two bedroom apartment in Wedmore, Lydia commenced the lease extension process as the eighty year deadline was swiftly nearing. The transaction was finalised in June 2006. The landlord’s fees were restricted to below 500 pounds.
In 2012 we were phoned by Mr and Mrs. F Martinez who, having acquired a one bedroom flat in Wedmore in July 2003. We are asked if we could estimate the premium could be to extend the lease by 90 years. Identical residencies in Wedmore with 100 year plus lease were valued about £280,000. The mid-range amount of ground rent was £45 billed per annum. The lease ran out in 2096. Given that there were 70 years outstanding we calculated the premium to the landlord to extend the lease to be between £12,400 and £14,200 exclusive of fees.
In 2009 we were contacted by Dr F Sharif who, having owned a one bedroom apartment in Wedmore in August 2006. We are asked if we could estimate the compensation to the landlord would be for a 90 year lease extension. Comparable residencies in Wedmore with an extended lease were in the region of £223,400. The mid-range ground rent payable was £60 billed yearly. The lease finished in 2085. Given that there were 59 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £27,600 and £31,800 not including legals.