For anyone whose Welton flat is held on a long lease, our message is clear – if you do nothing, your property will ultimately revert to your landlord, leaving you empty-handed. The fewer the years remaining the lower the value of the property and the more it will cost to procure a lease extension.
It is generally considered that a property with more than 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 35 years left, the property 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service gives you enhanced control over the value of your Welton leasehold, as your property will be more valuable and saleable in respect of lease length should you decide 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 owned a 2 bedroom apartment in Welton on the market with a lease of fraction over 59 years unexpired. Gabriel on an informal basis contacted his landlord being a well known London-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 new rent to start with set at £100 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Gabriel to invoke his statutory right. Gabriel obtained expert legal guidance and was able to make an informed judgement and deal with the matter and sell the flat.
In 2009 we were called by Ms W Bennett who, having was assigned a lease of a garden apartment in Welton in April 2005. The dilemma was if we could approximate the price would likely be for a 90 year lease extension. Identical premises in Welton with an extended lease were in the region of £246,800. The mid-range amount of ground rent was £60 collected monthly. The lease expired in 2076. Given that there were 50 years outstanding we calculated the premium to the landlord to extend the lease to be within £44,700 and £51,600 exclusive of costs.
In 2009 we were contacted by Mr and Mrs. C Murphy who, having owned a first floor apartment in Welton in November 2012. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be to prolong the lease by 90 years. Comparable properties in Welton with an extended lease were in the region of £203,200. The average amount of ground rent was £65 billed per annum. The lease lapsed in 2087. Taking into account 61 years outstanding we estimated the premium to the landlord for the lease extension to be within £19,000 and £22,000 plus professional charges.