Woolacombe leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease becomes more expensive. It is the case that most Woolacombe tenants have the right to extend their lease by an additional ninety years under the 1993 Leasehold Reform Act. Where you are a leasehold owner in Woolacombe you would be well advised to check if your lease has between 70 and 90 years remaining. There are good reasons why a Woolacombe leaseholder with a lease having around 80 years remaining should take action to ensure that a lease extension is put in place without delay
Leasehold premises in Woolacombe with over one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
Regardless of whether you are a tenant or a freeholder in Woolacombe,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Woolacombe valuers.
Stanley was the the leasehold proprietor of a conversion flat in Woolacombe being marketed with a lease of fraction over fifty eight years remaining. Stanley informally approached his freeholder being a well known Bristol-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent initially set at £100 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Stanley to invoke his statutory right. Stanley procured expert advice and secured an acceptable deal without resorting to tribunal and sell the property.
Dr Alexander Carter bought a one bedroom flat in Woolacombe in May 1997. We are asked if we could approximate the compensation to the landlord could be to prolong the lease by 90 years. Comparable homes in Woolacombe with an extended lease were worth £205,000. The average ground rent payable was £50 billed yearly. The lease concluded on 9 March 2105. Taking into account 79 years left we approximated the premium to the landlord to extend the lease to be between £8,600 and £9,800 not including costs.
Mr and Mrs. H Cox purchased a garden apartment in Woolacombe in March 2009. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be for a ninety year extension to my lease. Similar homes in Woolacombe with 100 year plus lease were valued around £275,000. The average ground rent payable was £65 invoiced annually. The lease ran out in 2094. Having 68 years remaining we calculated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 exclusive of costs.