Wombwell residential property owned on a long lease is a depreciating asset as the leaseholder only owns the property for a set term.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Godiva Mortgages | 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. |
| 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 |
The conveyancers that we work with handle Wombwell 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.
Last year Alfie, came perilously close to the 80-year threshold with the lease on his ground floor apartment in Wombwell. In buying his home 19 years previously, the lease term was of no relevance. by good luck, he noticed he needed to take steps soon on Extending the lease. Alfie arranged for a lease extension just under the wire last August. Alfie and the freeholder subsequently settled on sum of £5,000 . If he failed to meet the deadline, the figure would have become more exhorbitant by a minimum £1,150.
In 2009 we were called by Mrs Tia Murphy who, having took over the lease of a one bedroom apartment in Wombwell in November 2003. The dilemma was if we could approximate the compensation to the landlord would be for a 90 year lease extension. Identical residencies in Wombwell with a long lease were in the region of £173,800. The average ground rent payable was £60 collected quarterly. The lease finished on 8 September 2081. Having 55 years remaining we estimated the compensation to the freeholder for the lease extension to be between £31,400 and £36,200 plus professional charges.
Last Winter we were contacted by Mrs Jasmine López , who purchased a basement flat in Wombwell in May 1996. We are asked if we could estimate the price would be for a 90 year lease extension. Identical premises in Wombwell with 100 year plus lease were worth £235,200. The mid-range ground rent payable was £45 invoiced per annum. The lease expired on 27 April 2092. Considering the 66 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 plus professional charges.