It’s a harsh truth that a Woolton residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Woolton property market.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips under 80 years - otherwise a higher amount will be payable. The majority of leasehold owners in Woolton will be able to extend under the legislation; however a lawyer should be able to confirm whether you are eligibility. In some situations you may not qualify. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer from beginning to end of the process.
Leasehold premises in Woolton with over 100 years left on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges merit 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. |
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Lease extensions in Woolton can be a difficult process. We recommend you secure guidance from a conveyancer and surveyor with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Woolton lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Following lengthy discussions with the freeholder of her garden apartment in Woolton, Amelia initiated the lease extension process just as her lease was coming close to the crucial 80-year threshold. The legal work completed in July 2007. The landlord’s charges were negotiated to slightly above 500 GBP.
Mr G Peterson purchased a garden flat in Woolton in September 2008. We are asked if we could estimate the price would be to extend the lease by 90 years. Identical residencies in Woolton with an extended lease were in the region of £210,000. The average ground rent payable was £50 invoiced every twelve months. The lease ran out in 2105. Taking into account 79 years outstanding we estimated the premium to the landlord for the lease extension to be between £8,600 and £9,800 not including professional charges.
Last August we were contacted by Ms Kate Martin , who bought a recently refurbished apartment in Woolton in October 1995. We are asked if we could approximate the compensation to the landlord would be for a 90 year lease extension. Comparable homes in Woolton with an extended lease were worth £275,000. The average amount of ground rent was £65 invoiced monthly. The lease lapsed in 2094. Having 68 years as a residual term we calculated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 not including legals.