The re-sale value of a leasehold property in Woolacombe is impacted by how long the lease has left to run. If it is close to or less than 80 years you should foresee difficulties on re-sale, so it is advisable to arrange for the lease to be extended prior to purchasing. It is ideal to start the process of extending the lease is when a lease still has 82 years remaining so that all matters can be finalised prior to the eighty year threshold. Statute entitles Woolacombe qualifying lessees to acquire a lease extension of 90 years on top of the remaining length of the lease at a peppercorn rent (that is, rent free). The reason of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold residencies in Woolacombe with over 100 years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges justify it.
Lender | Requirement |
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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. |
Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
Chelsea 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. |
Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
Retaining our service will provide you increased control over the value of your Woolacombe leasehold, as your property will be more valuable and saleable in relation to the lease length should you want to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In 2014 Jayden, started to get close to the 80-year threshold with the lease on his ground floor apartment in Woolacombe. In buying his flat twenty years previously, the length of the lease was of little bearing. As luck would have it, he became aware that he needed to take action soon on a lease extension. Jayden arranged for a lease extension just ahead of time last April. Jayden and the landlord subsequently settled on sum of £5,000 . If the lease had fallen to less than eighty years, the figure would have become more exhorbitant by a minimum £1,025.
Dr F Nelson owned a purpose-built apartment in Woolacombe in March 1996. We are asked if we could estimate the price could be for a 90 year lease extension. Similar properties in Woolacombe with an extended lease were valued around £225,800. The average ground rent payable was £60 billed yearly. The lease ran out in 2085. Considering the 60 years left we estimated the premium to the landlord for the lease extension to be between £23,800 and £27,400 plus professional charges.
In 2011 we were phoned by Dr Y Bertrand who, having was assigned a lease of a one bedroom apartment in Woolacombe in September 2004. We are asked if we could estimate the price would likely be to extend the lease by ninety years. Similar properties in Woolacombe with a long lease were valued about £210,000. The average amount of ground rent was £50 billed quarterly. The lease expired on 26 January 2105. Having 80 years remaining we calculated the compensation to the landlord to extend the lease to be within £8,600 and £9,800 not including costs.