Wigan leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. It is the case that most Wigan 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 Wigan 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 cost of any lease extension sharply increases as part of the premium you will incur is what is known as a marriage value
It is conventional wisdom that a residential leasehold with over one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start 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 |
| 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 procure guidance from a conveyancer and surveyor 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 dealing with Wigan lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Max was the the leasehold proprietor of a conversion flat in Wigan being sold with a lease of a few days over 61 years unexpired. Max on an informal basis approached his landlord being a well known local-based freehold company for a lease extension. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £200 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Max to exercise his statutory right. Max obtained expert advice and was able to make an informed judgement and handle with the matter and sell the flat.
Last Winter we were e-mailed by Mrs Kate Phillips , who purchased a ground floor flat in Wigan in March 2004. The dilemma was if we could approximate the premium would be to prolong the lease by ninety years. Similar properties in Wigan with an extended lease were in the region of £203,200. The mid-range amount of ground rent was £65 billed quarterly. The lease ran out on 11 May 2087. Given that there were 61 years unexpired we calculated the compensation to the freeholder for the lease extension to be between £19,000 and £22,000 not including expenses.
Last Spring we were e-mailed by Mr and Mrs. N Flores , who completed a basement apartment in Wigan in May 1998. The dilemma was if we could approximate the premium would be to prolong the lease by an additional years. Similar flats in Wigan with a long lease were worth £260,000. The mid-range amount of ground rent was £50 billed per annum. The lease came to a finish on 28 July 2098. Given that there were 72 years left we estimated the premium to the landlord to extend the lease to be within £9,500 and £11,000 not including fees.