The value of Woodstock leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can increase substantially once the unexpired lease term is less than eighty years
Leasehold premises in Woodstock with in excess of one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with handle Woodstock 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.
Last October Jude, started to get near to the 80-year threshold with the lease on his first floor flat in Woodstock. In buying his flat 19 years ago, the lease term was of little concern. Fortunately, he recognised he would soon be paying way over the odds for a lease extension. Jude extended the lease just under the wire last March. Jude and the landlord subsequently agreed on an amount of £5,000 . If he failed to meet the deadline, the premium would have escalated by at least £875.
In 2012 we were phoned by Dr W Cooper who, having owned a garden flat in Woodstock in August 2001. We are asked if we could estimate the price would be to extend the lease by 90 years. Comparable flats in Woodstock with a long lease were in the region of £216,000. The mid-range ground rent payable was £60 invoiced yearly. The lease terminated in 2084. Having 58 years left we approximated the compensation to the landlord to extend the lease to be between £28,500 and £33,000 plus legals.
Last month we were approach by Dr Lydia Rogers , who took over the lease of a garden apartment in Woodstock in March 2008. The dilemma was if we could estimate the compensation to the landlord could be for a 90 year lease extension. Comparable premises in Woodstock with a long lease were worth £200,000. The mid-range ground rent payable was £50 collected annually. The lease finished on 12 January 2104. Having 78 years left we calculated the compensation to the landlord to extend the lease to be within £8,600 and £9,800 plus professional charges.