It’s an underpublicised certainty that a Wingate residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Wingate property market.Where your lease has approximately 90 years left, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips under eighty years - otherwise a higher premium will be due. Most flat owners in Wingate will be able to extend under the legislation; however a conveyancer should be able to clarify whether you are eligibility. In some situations you may not qualify. There are also strict timeframes and procedures to follow once the process has commenced and you will need to be guided by your lawyer for the duration of the process.
Leasehold properties in Wingate with in excess of one hundred years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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. |
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at 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. |
The conveyancers that we work with handle Wingate 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.
Harry was the the leasehold owner of a conversion flat in Wingate being marketed with a lease of fraction over fifty eight years unexpired. Harry on an informal basis approached his landlord being a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent to start with set at £200 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Harry to exercise his statutory right. Harry procured expert advice and was able to make an informed judgement and deal with the matter and sell the property.
Last Summer we were phoned by Ms C Rose , who owned a studio flat in Wingate in March 1996. We are asked if we could shed any light on how much (approximately) premium could be to prolong the lease by 90 years. Similar flats in Wingate with a long lease were worth £200,000. The mid-range ground rent payable was £50 collected every twelve months. The lease came to a finish on 9 January 2103. Having 77 years unexpired we estimated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 exclusive of legals.
Dr Sian Miller took over the lease of a studio apartment in Wingate in September 2001. The dilemma was if we could estimate the compensation to the landlord could be for a 90 year lease extension. Comparative homes in Wingate with an extended lease were worth £265,200. The mid-range amount of ground rent was £65 collected per annum. The lease ran out in 2092. Taking into account 66 years remaining we approximated the compensation to the freeholder to extend the lease to be within £15,200 and £17,600 not including legals.