Welton leases on domestic properties are gradually losing value. Where your lease has about 90 years unexpired, you should start considering the need for a lease extension. 80 years is a significant number: when the remaining term of a lease drops below this level then you start paying an additional element called marriage value. Leasehold owners in Welton will usually qualify for a lease extension; however it’s a good idea to check with a lawyer to check if you qualify. In certain cases you may not be entitled. There are prescribed deadlines and formalities to follow once the process is triggered so it’s best to be guided by a conveyancing solicitor during the process.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
The conveyancing solicitors that we work with handle Welton 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 conveyancer we work with provide it.
In 2014 Alexander, started to get close to the 80-year threshold with the lease on his two bedroom apartment in Welton. In buying his property 18 years ago, the length of the lease was of no interest. Thankfully, he recognised he needed to take action soon on Extending the lease. Alexander extended the lease just under the wire last April. Alexander and the freeholder subsequently agreed on sum of £5,500 . If the lease had descended below 80 years, the sum would have increased by a minimum £1,025.
In 2014 we were e-mailed by Mrs I Lewis who, having took over the lease of a studio apartment in Welton in April 2002. We are asked if we could approximate the premium would be for a ninety year lease extension. Comparable residencies in Welton with 100 year plus lease were worth £193,400. The average amount of ground rent was £65 invoiced yearly. The lease ran out on 26 January 2084. Having 59 years remaining we approximated the compensation to the landlord for the lease extension to be between £21,900 and £25,200 exclusive of fees.
Mr and Mrs. G Laurent purchased a garden apartment in Welton in January 2011. We are asked if we could shed any light on how much (roughly) price would likely be for a 90 year extension to my lease. Comparable homes in Welton with a long lease were in the region of £250,000. The average amount of ground rent was £50 billed quarterly. The lease expiry date was on 5 August 2095. Taking into account 70 years outstanding we approximated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 plus professional charges.