If you are facing a significant premium because your lease in Woodside has dropped toward the 80-year mark, your previous lawyer may be at fault. Our panel of experts specialise in recovering lease extension costs from negligent firms who failed to protect your investment.
Why you should commence your Woodside lease extension today:
Increase your lease and increase your Woodside property value
As the length of the unexpired term of a Woodside residential lease lessens so does its value and therefore the value of your property. Where the lease has, over one hundred years to run then this decrease may be negligible however there will become a point in time when a lease has under than eighty years left as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main reason why you should consider extending without delay. Most flat owners in Woodside will meet the qualifying criteria; that being said a lawyer can advise whether you qualify for a lease extension. In limited situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
An extended lease has roughly the same value as a freehold
Leasehold residencies in Woodside with over one hundred years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges merit it.
Banks and Building Societies will not loan monies on a short lease
Nearly all banks and building societies insist on a lengthy amount of time left on any leasehold residence before they will contemplate providing a mortgage on it. Regardless of whether you need a mortgage, you should be conscious that it is likely that someone wishing to purchase your property in the future might well do, so if they can't obtain a mortgage, then the market price of the property will likely be adversely impacted. In the last decade many banks and building societies have increased the required minimum lease length that they are willing to lend on
| Lender |
Requirement
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|---|
| 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.
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| Bank of Scotland |
Minimum 70 years from the date of the mortgage.
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| Barnsley Building Society |
60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term.
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| Nationwide Building Society |
- Our minimum unexpired lease term is 55 years, except where lending is over 85% of the purchase price/valuation on a second hand flat, in which case our minimum unexpired term is 90 years.
- There must be at least 30 years remaining at the end of the mortgage term (regardless of the length of lease at the start).
Where the unexpired lease term is different to that recorded on the mortgage offer, the following clarifies if we need to be informed:
Second hand property:
- If the unexpired lease term on the offer is 85 years or more - only advise us if the actual lease term is less than 85 years
- if the unexpired lease term on the offer is less than 85 years – advise us if the actual lease term is different than reported
- For equity share applications - advise us if the actual lease term is different than reported on the offer
- Where lending is over 85% of the purchase price/valuation on a second hand flat and the unexpired lease term on the offer is 90 years or more - only advise us if the actual lease term is less than 90 years.
New build property:
- If the unexpired lease term stated on the offer is 125 years (flat) / 250 years (house) or more - only advise us if the actual lease term is less than 125 years (flat) / 250 years (house)
- For equity share applications - always advise us if the actual lease term is different than reported on the offer
Lease terms such as ground rent and event fees must be reasonable at all times during the term of the lease and adhere to our requirements below. If you’re unsure as to whether the terms of a lease are unreasonable or onerous, please refer the details to us in plain English for Valuer consideration. If the potentially onerous terms are in relation to the ground rent please include the current ground rent figure per annum, how often it will be reviewed and the price structure it will be reviewed against. See the guidance below.
SECOND HAND PROPERTIES
Unacceptable - advise Issuing Office (Will be declined):
- Unexpired lease term less than 55 years
- Unexpired lease term less than 90 years where we are lending more than 85% of the purchase price/valuation on a second hand flat
- Less than 30 years remaining at the end of the mortgage term
- Ground Rent greater than 0.5% of the property value
- Ground Rent doubles less than every 20 years (e.g. doubles every 5, 10 or 15 years) - acceptable if doubles every 20 years or more
- Ground Rent is compounded RPI
- Ground Rent review period is less than or equal to 5 years
Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Unexpired lease term is 55 to 85 years
- Ground Rent greater than 0.1% and less than or equal to 0.5% of the property value
- Ground Rent escalation is linked to any indices greater than RPI
- Ground Rent escalation is linked to the value of the building*
- Ground Rent review period is greater than 5 and less than 10 years
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial, etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1% of property value p/a (please provide details of what the charges cover)
- Anything that appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than 85 years (Minimum 90 years where we are lending more than 85% of the purchase price/valuation on a second hand flat)
- Ground Rent less than or equal to 0.1% of the property value
- Ground Rent review period greater than or equal to 10 years
- Ground Rent escalation less than or equal to RPI
NEW BUILD PROPERTIES (includes office conversions)
Unacceptable - advise Issuing Office (Will be declined)
- Unexpired lease term less than 125 years on a new build flat or less than 250 years on a new build house (does not apply to Shared Ownership)
- Any lease which is subject to a Ground Rent (or Annual Rent) being charged which is more than on a peppercorn basis
- Any lease which is subject to a Ground Rent (or Annual Rent) being charged which is more than on a peppercorn basis
Refer to Issuing Office (Valuer will consider any impact on valuation figure and marketability):
- Event clauses exist for normal use e.g. changing the carpet, installing a TV aerial etc
- Estate Rent Charges greater than £500 p/a (please provide details of what the charges cover)
- Service Charges greater than 1% of property value p/a (please provide details of what the charges cover)
- Anything else appears onerous, unusual or out of the ordinary
Acceptable (no requirement to advise Issuing Office):
- Unexpired lease term greater than or equal to 125 years on a new build flat or greater than or equal to 250 years on a new build house
- A lease subject to a peppercorn Ground Rent (Annual Rent) charges
For the avoidance of doubt, any New Build properties completed but not sold pre-30 June 2022 will only be acceptable if the Lease conforms to the above guidance.
* Where the Ground Rent escalation is linked to the value of the building, please provide the following:
- How is the value of the block/unit currently calculated and if the assessment relates to the block(s), how is the Ground Rent calculated/apportioned per property?
- The current valuation and Ground Rent for each unit
- What is the mechanism for future valuations of the block and how is the Ground Rent calculated/apportioned?
- What is the right of appeal? And is this a documented process within the lease?
- Who bears the cost of the valuation (and appeal) process?
- Confirmation the review period is not less than twenty years.
Lease Extensions We require all Lease Extensions to be completed under the Leasehold Reform Housing and Urban Development Act 1993 and to meet the above criteria as a minimum. Where a proposed Lease Extension does not meet these requirements, however you feel that this is in the best interest for our mutual client, please refer all details to the Issuing Office for us to consider.
Please ensure that all lender enquiries are submitted (with full documentation/requirements) at least 2 weeks prior to exchange to allow sufficient time for review and decisioning.
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| Virgin |
85 years at the time of completion. If it's less, we require it to be extended on or before completion.
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Get in touch with one of our Woodside lease extension solicitors or enfranchisement solicitors
The lawyers that we work with handle Woodside 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.
Woodside Lease Extension Case Studies:
Aiden, Woodside, South East London
Last year Aiden, started to get close to the eighty-year threshold with the lease on his garden flat in Woodside. In buying his property 19 years ago, the length of the lease was of no significance. Fortunately, he noticed he needed to take action soon on Extending the lease. Aiden was able to extend his lease just under the wire in September. Aiden and the freeholder via the managing agents ultimately agreed on sum of £5,500 . If the lease had fallen below eighty years, the figure would have gone up by a minimum £925.
Woodside case:
Dr Teddy Robinson purchased a one bedroom apartment in Woodside in March 2008. We are asked if we could shed any light on how much (roughly) price would likely be to extend the lease by 90 years. Comparative flats in Woodside with a long lease were valued around £235,200. The average ground rent payable was £45 invoiced per annum. The lease came to a finish in 2092. Having 66 years as a residual term we calculated the premium to the landlord for the lease extension to be between £12,400 and £14,200 not including fees.
Decision in Croydon
An example of a Lease Extension case for a Woodside flat is
Ground Floor Flat 14 Lodge Road in October 2013. the tribunal held that the price payable for the acquisition of the extended lease of the
property should be £12,590 .00
This case affected 1 flat. The number of years remaining on the existing lease(s) was 69.46 years.