The re-sale value of a leasehold property in Wimbledon is impacted by how long the lease has left to run. If it is close to or fewer than eighty years you should anticipate difficulties on re-sale, so it is advisable to arrange for a lease extension ahead of purchasing. It is ideal to start the process of extending the lease is when the lease still has 82 years remaining so that all matters can be concluded prior to the eighty year mark. Statute enables Wimbledon qualifying lessees to obtain a new lease which will be for the current unexpired lease term plus an additional term of 90 years. The reason of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold properties in Wimbledon with over one hundred years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance 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 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Wimbledon can be a difficult process. We recommend you procure professional help from a conveyancing solicitor and valuer well versed in the legislation and lease extension process.
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 a wealth of experience dealing with Wimbledon lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
William owned a high value apartment in Wimbledon on the market with a lease of a little over 59 years remaining. William informally spoke with his freeholder 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 a new rent to start with set at £200 per annum and increase every 25 years thereafter. No ground rent would be due on a lease extension were William to exercise his statutory right. William obtained expert legal guidance and secured an acceptable deal without resorting to tribunal and ending up with a market value flat.
Last month we were called by Mr and Mrs. S James , who purchased a recently refurbished flat in Wimbledon in October 1999. We are asked if we could estimate the price would likely be to extend the lease by 90 years. Comparable flats in Wimbledon with a long lease were valued about £290,000. The average amount of ground rent was £45 invoiced monthly. The lease lapsed in 2097. Having 72 years outstanding we approximated the premium to the freeholder for the lease extension to be within £11,400 and £13,200 exclusive of legals.
An example of a Freehold Enfranchisement case for a Wimbledon premises is 629 Garratt Lane in September 2014. The consideration payable for the acquisition of the freehold of the subject property was the sum £21,302.74. This represented a valuation of the freehold in the sum of £23,864 from which the sum of £2561.27 has been deducted in respect of certain costs in repairing and insuring the premises This case was in relation to 3 flats. The unexpired term as at the valuation date was 72.94 years.