Widnes 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. It is the case that most Widnes tenants have the right to extend their lease by an additional 90 years by virtue of the 1993 Leasehold Reform Act. Where you are a leasehold owner in Widnes you would be well advised to see if your lease has between seventy and ninety years left. In particular once the remaining lease term slips under 80 years, the amount payable for any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
It is generally considered that a property with in excess of 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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. |
| 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with handle 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 conveyancer we work with provide it.
18 months ago Elijah, came precariously near to the eighty-year threshold with the lease on his ground floor flat in Widnes. In buying his flat two decades ago, the length of the lease was of minimal concern. Fortunately, he noticed he needed to take action soon on a lease extension. Elijah arranged for a lease extension at the eleventh hour in May. Elijah and the landlord ultimately settled on an amount of £5,000 . If he had missed the deadline, the figure would have gone up by at least £1,125.
Mr O Cox purchased a ground floor apartment in Widnes in February 2006. The question was if we could estimate the price would be to prolong the lease by 90 years. Comparative properties in Widnes with an extended lease were in the region of £242,600. The mid-range amount of ground rent was £45 billed per annum. The lease elapsed in 2093. Taking into account 67 years unexpired we calculated the premium to the landlord to extend the lease to be between £11,400 and £13,200 exclusive of legals.
In 2011 we were called by Mr Luca Watson who, having purchased a one bedroom flat in Widnes in April 2008. The question was if we could shed any light on how much (roughly) premium could be for a ninety year lease extension. Comparative premises in Widnes with an extended lease were in the region of £280,000. The mid-range ground rent payable was £55 invoiced every twelve months. The lease ended on 6 October 2104. Considering the 78 years as a residual term we estimated the compensation to the landlord for the lease extension to be within £13,300 and £15,400 exclusive of professional charges.