The market value of a leasehold property in Wigan depends on how long the lease has remaining. If it is close to or fewer than eighty years you should foresee difficulties on re-sale, so it is advisable to arrange for a lease extension prior to purchasing. It is preferable to commence the lease extension process when the lease still has 82 years unexpired so that a lease extension can be addressed in advance of the 80 year mark. Current legislation entitles Wigan qualifying lessees to a 90 year extension added to their unexpired lease term (ie if your lease has fifty years remaining the statutory lease extension will provide a new term of 140 years). The intention of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold residencies in Wigan with in excess of one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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 also be not less than 75 years at the outset of the mortgage. |
| 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. |
Lease extensions in Wigan can be a difficult process. We recommend you obtain guidance from a conveyancing solicitor and valuer with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring Wigan lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Logan owned a 2 bedroom apartment in Wigan being marketed with a lease of fraction over 72 years outstanding. Logan on an informal basis approached his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £50 yearly. No ground rent would be payable on a lease extension were Logan to exercise his statutory right. Logan procured expert advice and was able to make a more informed judgement and deal with the matter and readily saleable.
In 2011 we were e-mailed by Mr and Mrs. E Lefebvre who, having took over the lease of a recently refurbished apartment in Wigan in August 1995. We are asked if we could shed any light on how much (approximately) premium would likely be for a ninety year lease extension. Identical properties in Wigan with 100 year plus lease were in the region of £168,800. The average ground rent payable was £60 billed quarterly. The lease elapsed in 2080. Considering the 55 years outstanding we estimated the compensation to the freeholder for the lease extension to be within £31,400 and £36,200 exclusive of professional charges.
In 2011 we were phoned by Mr E Peterson who, having moved into a one bedroom apartment in Wigan in June 2001. We are asked if we could estimate the premium could be for a 90 year extension to my lease. Comparable residencies in Wigan with an extended lease were worth £235,200. The average amount of ground rent was £45 invoiced every twelve months. The lease elapsed in 2091. Considering the 66 years outstanding we approximated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of professional charges.