The market value of Whaley Bridge leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can increase materialy once the remaining term is less than 80 years
Leasehold premises in Whaley Bridge with in excess of one hundred years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges warrant 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 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; |
| Godiva Mortgages | 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. |
| 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 |
Irrespective of whether you are a tenant or a landlord in Whaley Bridge,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Whaley Bridge valuers.
William owned a conversion flat in Whaley Bridge on the market with a lease of a little over 59 years left. William informally contacted his landlord being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of an increased rent to £200 yearly. No ground rent would be due on a lease extension were William to exercise his statutory right. William procured expert advice and was able to make a more informed judgement and deal with the matter and sell the property.
In 2011 we were phoned by Mr U Collins who, having bought a first floor apartment in Whaley Bridge in March 2005. We are asked if we could estimate the compensation to the landlord would be for a ninety year extension to my lease. Comparative residencies in Whaley Bridge with 100 year plus lease were valued about £225,800. The average ground rent payable was £60 collected quarterly. The lease end date was on 6 February 2085. Given that there were 60 years unexpired we calculated the premium to the freeholder for the lease extension to be within £24,700 and £28,600 not including legals.
Last Spring we were approach by Mr and Mrs. T Scott , who owned a first floor flat in Whaley Bridge in August 2000. We are asked if we could shed any light on how much (roughly) premium would likely be for a ninety year lease extension. Identical homes in Whaley Bridge with an extended lease were valued about £210,000. The average amount of ground rent was £50 invoiced quarterly. The lease expired in 2105. Taking into account 80 years unexpired we calculated the premium to the landlord for the lease extension to be within £8,600 and £9,800 exclusive of professional charges.