Wolston leases on residential properties are gradually losing 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. Legislation has been in place for sometime now allowing qualifying Wolston residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Wolston you should see if your lease has between 70 and 90 years remaining. There are good reasons why a Wolston leaseholder with a lease having around 80 years remaining should take action to make sure that a lease extension is actioned without delay
Leasehold residencies in Wolston with more than one hundred years unexpired 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 home. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Retaining our service will provide you enhanced control over the value of your Wolston leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Trailing unsuccessful correspondence with the landlord of her two bedroom flat in Wolston, Tia initiated the lease extension process as the eighty year deadline was swiftly coming. The legal work was finalised in June 2007. The freeholder’s charges were kept to an absolute minimum.
In 2010 we were called by Mr and Mrs. R Martínez who, having was assigned a lease of a newly refurbished apartment in Wolston in August 2011. The dilemma was if we could shed any light on how much (approximately) price would likely be for a ninety year extension to my lease. Comparable flats in Wolston with a long lease were valued about £200,800. The average amount of ground rent was £65 collected annually. The lease terminated in 2086. Taking into account 60 years unexpired we calculated the compensation to the landlord to extend the lease to be within £20,900 and £24,200 exclusive of costs.
In 2013 we were contacted by Mrs Amber Gunderson who, having moved into a one bedroom flat in Wolston in July 1995. We are asked if we could shed any light on how much (roughly) premium could be to extend the lease by 90 years. Comparative residencies in Wolston with an extended lease were valued about £260,000. The mid-range ground rent payable was £50 invoiced every twelve months. The lease finished on 13 November 2097. Having 71 years as a residual term we approximated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 plus expenses.