With a long leasehold premises in Wool, you are actually buying an entitlement to live in a property for a prescribed time frame. These days flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you may consider extending the lease sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease gets disproportionately greater particularly once there are less than eighty years left. Anyone in Wool with a lease nearing 81 years unexpired should seriously think of extending it sooner than later. When the lease term has less than eighty years remaining, under the current statute the landlord is entitled to calculate and demand a larger amount, based on a technical calculation, strangely termed as “marriage value” which is due.
It is generally accepted that a property with over one hundred years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Irrespective of whether you are a tenant or a freeholder in Wool,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Wool valuers.
Last year Nathan, started to get near to the 80-year threshold with the lease on his studio flat in Wool. In buying his flat 18 years ago, the length of the lease was of minimal bearing. Fortunately, he realised he would soon be paying an escalated premium for Extending the lease. Nathan was able to extend his lease just in the nick of time in August. Nathan and the freeholder subsequently agreed on sum of £5,000 . If the lease had dropped lower than 80 years, the figure would have become more costly by at least £950.
Last Spring we were contacted by Mr R Wright , who owned a first floor flat in Wool in March 2011. We are asked if we could shed any light on how much (approximately) premium would be to extend the lease by a further 90 years. Comparable homes in Wool with a long lease were worth £173,800. The average amount of ground rent was £60 collected per annum. The lease expired on 17 October 2080. Considering the 55 years remaining we approximated the premium to the freeholder for the lease extension to be within £31,400 and £36,200 not including expenses.
Last Christmas we were contacted by Mr and Mrs. E Allen , who owned a basement apartment in Wool in March 1996. We are asked if we could approximate the premium could be to extend the lease by a further 90 years. Identical homes in Wool with an extended lease were in the region of £235,200. The mid-range ground rent payable was £45 invoiced quarterly. The lease ended on 4 June 2091. Considering the 66 years as a residual term we approximated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 plus costs.