The re-sale value of a leasehold property in Widdrington depends on how long the lease has left to run. If it is close to or fewer than eighty years you should expect problems on re-sale, so it is recommended to arrange for the lease to be extended prior to buying. It is preferable to start the lease extension process when the lease still has 82 years unexpired so that formalities can be addressed in advance of the eighty year threshold. Current legislation entitles Widdrington qualifying lessees to acquire a new lease which will be for the current unexpired lease term plus a further term of ninety years. The purpose of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold premises in Widdrington with over 100 years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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 |
The conveyancers that we work with procure Widdrington 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 conveyancing solicitor we work with provide it.
Half a year ago Edward, came very close to the 80-year mark with the lease on his two bedroom apartment in Widdrington. Having purchased his home 19 years ago, the length of the lease was of minimal bearing. As luck would have it, he recognised he would imminently be paying an inflated amount for Extending the lease. Edward extended the lease just ahead of time in August. Edward and the landlord subsequently agreed on sum of £5,500 . If he had missed the deadline, the sum would have become more exhorbitant by at least £1,125.
Last year we were phoned by Mr and Mrs. N Cox , who was assigned a lease of a ground floor flat in Widdrington in July 2003. We are asked if we could shed any light on how much (approximately) price would likely be for a 90 year extension to my lease. Comparative premises in Widdrington with 100 year plus lease were in the region of £200,000. The mid-range ground rent payable was £50 collected quarterly. The lease end date was on 3 October 2102. Considering the 77 years outstanding we approximated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 exclusive of expenses.
In 2014 we were e-mailed by Mr and Mrs. V François who, having took over the lease of a garden apartment in Widdrington in June 2002. The question was if we could estimate the compensation to the landlord would be for a 90 year lease extension. Identical residencies in Widdrington with a long lease were worth £265,200. The average ground rent payable was £65 collected yearly. The lease finished in 2091. Having 66 years outstanding we approximated the premium to the freeholder for the lease extension to be between £15,200 and £17,600 exclusive of expenses.