As the the remaining lease term of a Woolacombe residential lease decreases so does its value and therefore the value of your property. If the residual term has, over one hundred years remaining then this decrease may be of little impact however there will become a stage when a lease has under than 80 years unexpired as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main rational as to why you should consider extending sooner than later. Many flat owners in Woolacombe will qualify for this right; that being said a lawyer can confirm if you qualify to extend your lease. In limited situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
It is generally accepted that a property with over one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
The lawyers that we work with procure Woolacombe 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 lawyer we work with provide it.
Two years ago Ryan, came dangerously near to the eighty-year threshold with the lease on his ground floor apartment in Woolacombe. In buying his property two decades ago, the lease term was of little interest. Thankfully, it dawned on him that he needed to take steps soon on a lease extension. Ryan arranged for a lease extension at the eleventh hour last March. Ryan and the freeholder in the end agreed on sum of £5,500 . If the lease had slid to less than 80 years, the sum would have increased by at least £975.
Last year we were called by Dr J Norbert , who completed a studio flat in Woolacombe in October 2007. The dilemma was if we could estimate the price would be for a ninety year lease extension. Comparative properties in Woolacombe with a long lease were in the region of £200,000. The average ground rent payable was £50 invoiced monthly. The lease finished on 2 October 2102. Considering the 77 years as a residual term we estimated the compensation to the landlord for the lease extension to be between £8,600 and £9,800 plus professional charges.
In 2009 we were approached by Mrs Jodie Collins who, having took over the lease of a one bedroom flat in Woolacombe in January 1996. We are asked if we could estimate the compensation to the landlord would be for a ninety year extension to my lease. Comparative flats in Woolacombe with a long lease were worth £260,200. The mid-range ground rent payable was £65 invoiced monthly. The lease expired on 17 July 2091. Considering the 66 years unexpired we calculated the premium to the freeholder for the lease extension to be within £15,200 and £17,600 exclusive of expenses.