It’s a harsh certainty that a Witney residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the early years due to the depreciation being disguised by increases in the Witney property market.Where your lease has approximately 90 years left, you need to start considering 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 falls lower than 80 years - otherwise a higher amount will be due. Most leasehold owners in Witney will be able to extend under the legislation; however a conveyancer should be able to clarify whether you qualify for an extension. In some cases 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.
It is generally considered that a property with in excess of one hundred years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 35 years unexpired, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | 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. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Witney,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Witney valuers.
After lengthy correspondence with the landlord of her studio apartment in Witney, Lily initiated the lease extension process just as her lease was approaching the all-important eighty-year deadline. The lease extension completed in November 2011. The landlord’s fees were restricted to slightly above 450 pounds.
Mr Finn Ricardo completed a one bedroom apartment in Witney in August 1998. We are asked if we could estimate the premium could be to extend the lease by a further 90 years. Identical properties in Witney with a long lease were worth £191,400. The mid-range ground rent payable was £55 billed monthly. The lease finished on 24 June 2080. Considering the 54 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £34,200 and £39,600 exclusive of expenses.
Last year we were e-mailed by Mrs B Miller , who took over the lease of a garden flat in Witney in March 2002. We are asked if we could approximate the premium would be for a 90 year lease extension. Comparable premises in Witney with an extended lease were valued around £295,000. The mid-range amount of ground rent was £45 billed quarterly. The lease expired on 10 June 2100. Having 74 years unexpired we approximated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 not including professional charges.