Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will usually be granted for a set period of time , usually 99 or 125 years, although we have witnessed longer and shorter terms in Waddon. Inevitably, the period of lease left reduces as time goes by. This may slip by relatively unnoticed when the property has to be sold or refinanced. The fewer the years remaining the less it is worth and the more expensive it will be to obtain a lease extension. Eligible leaseholders in Waddon have the right to extend the lease for an additional 90 years under the 1993 Leasehold Reform Act. Please give careful attention before putting off your Waddon lease extension. Putting off that expense now only increases the price you will eventually have to pay to extend your lease
It is generally considered that a property with over one hundred years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 30 years remaining, the property will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Yorkshire 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. |
Irrespective of whether you are a tenant or a freeholder in Waddon,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Waddon valuers.
Trailing lengthy negotiations with the landlord of her first floor flat in Waddon, Jasmine initiated the lease extension process as the eighty year threshold was fast approaching. The legal work completed in August 2013. The freeholder’s charges were negotiated to below 550 GBP.
Last Summer we were e-mailed by Ms Paige Young , who bought a studio apartment in Waddon in May 2009. The question was if we could approximate the premium would likely be to extend the lease by ninety years. Comparative premises in Waddon with an extended lease were in the region of £257,800. The average ground rent payable was £65 billed quarterly. The lease end date was in 2090. Taking into account 65 years unexpired we approximated the compensation to the freeholder to extend the lease to be within £18,100 and £20,800 exclusive of fees.
An example of a Freehold Enfranchisement decision for a Waddon residence is 29 Woodstock Road in April 2014. the Tribunal determined that the premiums to be paid into court in respect of the purchase of the freehold registered at HMLR under Title N0.SY3997 should be £7,217. This case related to 4 flats. The remaining number of years on the lease was 98 years.