There is no doubt about it a leasehold property in Woburn is a wasting asset as a result of the diminishing lease term. If the lease has, in excess of one hundred years to run then this decrease may be of little impact however there will become a point in time when a lease has less than 80 years remaining as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main rational as to why you should extend the lease sooner than later. Many flat owners in Woburn will meet the qualifying criteria; nevertheless a lawyer should be able to advise whether you qualify for a lease extension. In limited situations you may not qualify, the most common reason being that you have owned the property for under two years.
It is conventional wisdom that a property with over 100 years remaining is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with handle Woburn 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 conveyancing solicitor we work with provide it.
In recent months Benjamin, came seriously near to the 80-year mark with the lease on his ground floor apartment in Woburn. In buying his home 18 years ago, the lease term was of little concern. by good luck, he noticed he would imminently be paying an inflated amount for Extending the lease. Benjamin was able to extend his lease at the eleventh hour in April. Benjamin and the freeholder subsequently settled on an amount of £5,500 . If the lease had slipped below eighty years, the premium would have escalated by at least £1,050.
In 2013 we were approached by Mrs M Lambert who, having was assigned a lease of a purpose-built flat in Woburn in June 1995. The dilemma was if we could approximate the premium would be for a 90 year extension to my lease. Similar residencies in Woburn with a long lease were in the region of £205,000. The average ground rent payable was £50 invoiced per annum. The lease end date was in 2104. Considering the 79 years left we estimated the premium to the freeholder to extend the lease to be within £7,600 and £8,800 plus professional charges.
In 2014 we were phoned by Mr U Vincent who, having completed a ground floor flat in Woburn in April 2002. We are asked if we could shed any light on how much (approximately) premium would likely be to prolong the lease by 90 years. Similar homes in Woburn with an extended lease were worth £275,000. The mid-range ground rent payable was £65 collected monthly. The lease came to a finish in 2093. Given that there were 68 years as a residual term we approximated the compensation to the landlord for the lease extension to be between £12,400 and £14,200 plus costs.