The value of Stow on the Wold leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can increase substantially once the remaining term is below than 80 years
Leasehold residencies in Stow on the Wold 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 situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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 conveyancing solicitors that we work with procure Stow on the Wold 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 conveyancing solicitor we work with provide it.
Theo owned a 2 bedroom apartment in Stow on the Wold on the market with a lease of a few days over fifty eight years outstanding. Theo on an informal basis approached his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £100 per annum and increase every 25 years thereafter. No ground rent would be payable on a lease extension were Theo to invoke his statutory right. Theo procured expert advice and secured an acceptable deal without going to tribunal and sell the flat.
Mr and Mrs. L André moved into a newly refurbished apartment in Stow on the Wold in August 2009. The dilemma was if we could estimate the compensation to the landlord could be to extend the lease by ninety years. Comparative flats in Stow on the Wold with a long lease were in the region of £255,000. The mid-range ground rent payable was £50 invoiced monthly. The lease came to a finish in 2096. Taking into account 70 years left we approximated the compensation to the landlord for the lease extension to be between £10,500 and £12,000 plus costs.
In 2012 we were approached by Mr and Mrs. S Nelson who, having purchased a garden flat in Stow on the Wold in July 1999. The question was if we could estimate the premium could be to extend the lease by an additional years. Comparable premises in Stow on the Wold with 100 year plus lease were in the region of £246,800. The average ground rent payable was £60 collected monthly. The lease came to a finish in 2076. Having 50 years outstanding we approximated the compensation to the freeholder to extend the lease to be within £44,700 and £51,600 exclusive of fees.