The re-sale value of a leasehold property in Wootton Bassett depends on how many years the lease has remaining. If it is near to or less than eighty years you should anticipate problems on re-sale, so it is recommended to arrange for the lease to be extended before purchasing. Ideally one should start the process of extending the lease is when a lease still has 82 years remaining so that formalities can be finalised well before the 80 year threshold. Statute entitles Wootton Bassett qualifying lessees to an additional term of 90 years on top of the unexpired term, at a peppercorn rent (zero ground rent). 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 properties in Wootton Bassett with in excess of 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 property. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and service 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. |
| 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 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
The conveyancers that we work with procure Wootton Bassett 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 conveyancer we work with provide it.
Two years ago Alfie, came perilously near to the eighty-year threshold with the lease on his studio apartment in Wootton Bassett. Having purchased his flat two decades ago, the length of the lease was of little interest. Fortunately, he recognised he would soon be paying way over the odds for a lease extension. Alfie arranged for a lease extension just in the nick of time last May. Alfie and the freeholder via the management company ultimately agreed on sum of £6,000 . If he failed to meet the deadline, the figure would have increased by a minimum £950.
Last year we were phoned by Mrs C Wright , who owned a one bedroom flat in Wootton Bassett in September 1997. The question was if we could shed any light on how much (roughly) price would be to extend the lease by an additional years. Similar flats in Wootton Bassett with 100 year plus lease were in the region of £205,000. The average ground rent payable was £50 invoiced yearly. The lease finished on 5 September 2104. Given that there were 79 years left we estimated the compensation to the landlord for the lease extension to be between £7,600 and £8,800 not including fees.
In 2014 we were e-mailed by Mr Y Thompson who, having bought a basement flat in Wootton Bassett in March 2007. The question was if we could estimate the compensation to the landlord would be to prolong the lease by an additional years. Identical properties in Wootton Bassett with a long lease were valued around £275,000. The mid-range ground rent payable was £65 collected annually. The lease elapsed in 2093. Considering the 68 years remaining we approximated the premium to the freeholder for the lease extension to be between £12,400 and £14,200 exclusive of legals.