Widnes leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Widnes residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Widnes you must see if your lease has between 70 and 90 years remaining. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
Leasehold properties in Widnes with in excess of 100 years unexpired on the lease are sometimes 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 service charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
The lawyers that we work with undertake Widnes 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 lawyer we work with provide it.
Last Spring Harry, came seriously near to the 80-year mark with the lease on his first floor apartment in Widnes. In buying his home two decades ago, the unexpired term was of no interest. Luckily, he realised he needed to take steps soon on a lease extension. Harry extended the lease just in the nick of time last June. Harry and the landlord ultimately agreed on a premium of £6,000 . If the lease had slid to less than eighty years, the price would have become more costly by at least £1,050.
Last August we were contacted by Mr Reuben Flores , who moved into a one bedroom apartment in Widnes in May 2009. The question was if we could approximate the price would be for a 90 year lease extension. Identical homes in Widnes with a long lease were valued around £264,000. The mid-range ground rent payable was £60 invoiced per annum. The lease end date was on 11 August 2079. Considering the 53 years as a residual term we approximated the premium to the landlord to extend the lease to be within £37,100 and £42,800 exclusive of expenses.
Ms Melissa Adams moved into a ground floor apartment in Widnes in March 2000. The question was if we could estimate the compensation to the landlord could be for a 90 year extension to my lease. Identical properties in Widnes with a long lease were valued about £225,400. The average ground rent payable was £45 collected per annum. The lease expired on 12 August 2090. Considering the 64 years outstanding we approximated the premium to the freeholder for the lease extension to be within £15,200 and £17,600 not including costs.