The re-sale value of a leasehold property in Willen is impacted by how many years the lease has left to run. If it is close to or less than 80 years you should anticipate difficulties on re-sale, so it is recommended to arrange for a lease extension before buying. Ideally one should start the process of extending the lease is when the lease still has 82 years remaining so that a lease extension can be finalised ahead of the eighty year mark. Current legislation entitles Willen qualifying lessees to obtain a new lease which will be for the current unexpired lease term plus a further term of 90 years. The purpose of the valuation is to determine the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold properties in Willen with in excess of one hundred years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Regardless of whether you are a tenant or a freeholder in Willen,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Willen valuers.
Ibrahim owned a conversion flat in Willen being sold with a lease of a little over 59 years outstanding. Ibrahim informally spoke with his landlord being a well known Bristol-based freehold company for a lease extension. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £100 annually. No ground rent would be due on a lease extension were Ibrahim to exercise his statutory right. Ibrahim procured expert legal guidance and secured satisfactory resolution informally and ending up with a market value flat.
Last Autumn we were approach by Dr V Anderson , who acquired a garden apartment in Willen in June 2005. The question was if we could approximate the compensation to the landlord would likely be to prolong the lease by an additional years. Comparative flats in Willen with a long lease were in the region of £280,000. The mid-range amount of ground rent was £45 collected monthly. The lease ended in 2095. Considering the 70 years outstanding we calculated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 not including legals.
Mr Oscar Brooks owned a ground floor flat in Willen in November 2011. We are asked if we could shed any light on how much (approximately) premium would be to extend the lease by 90 years. Comparative properties in Willen with a long lease were worth £223,400. The mid-range amount of ground rent was £60 billed quarterly. The lease ran out in 2084. Given that there were 59 years outstanding we estimated the compensation to the freeholder to extend the lease to be within £27,600 and £31,800 plus legals.