Westhoughton leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Legislation has been in place for sometime now which entitles qualifying Westhoughton residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Westhoughton you would be well advised to check if your lease has between seventy and ninety years remaining. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
Leasehold residencies in Westhoughton 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 property. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| 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. |
| 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. |
| 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 |
| 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. |
Irrespective of whether you are a tenant or a landlord in Westhoughton,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Westhoughton valuers.
Milo was the the leasehold proprietor of a high value flat in Westhoughton on the market with a lease of a few days over sixty years outstanding. Milo informally contacted his freeholder being a well known London-based freehold company for a lease extension. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £50 annually. Ordinarily, ground rent would not be due on a lease extension were Milo to invoke his statutory right. Milo obtained expert legal guidance and was able to make an informed decision and deal with the matter and sell the flat.
Mr and Mrs. O Allen completed a basement apartment in Westhoughton in July 2001. The question was if we could approximate the premium could be to prolong the lease by a further 90 years. Comparable homes in Westhoughton with a long lease were in the region of £254,200. The mid-range amount of ground rent was £60 invoiced yearly. The lease elapsed on 9 June 2076. Considering the 51 years outstanding we estimated the compensation to the landlord for the lease extension to be within £43,700 and £50,600 not including expenses.
In 2009 we were contacted by Mr and Mrs. Y Lambert who, having bought a garden flat in Westhoughton in June 1999. We are asked if we could shed any light on how much (roughly) premium could be to extend the lease by a further 90 years. Similar residencies in Westhoughton with 100 year plus lease were valued around £210,600. The mid-range amount of ground rent was £45 billed quarterly. The lease expired in 2087. Having 62 years remaining we calculated the premium to the freeholder for the lease extension to be within £18,100 and £20,800 exclusive of professional charges.