It’s a harsh certainty that a Altrincham residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the loss of value being disguised by increases in the Altrincham property market.Once your lease gets to 85ish years, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls under 80 years - otherwise a higher amount will be payable. Most leasehold owners in Altrincham will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm if you qualify for an extension. In some situations you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancer throughout the process.
Leasehold premises in Altrincham with in excess of 100 years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a landlord in Altrincham,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Altrincham valuers.
In recent months Max, started to get close to the eighty-year mark with the lease on his basement flat in Altrincham. In buying his home 18 years previously, the unexpired term was of no bearing. Fortunately, he noticed he would imminently be paying way over the odds for Extending the lease. Max extended the lease just under the wire in August. Max and the landlord who owned the flat above eventually settled on an amount of £5,500 . If the lease had slid to less than eighty years, the price would have gone up by at least £925.
Last year we were contacted by Mrs Amelia Lambert , who purchased a basement apartment in Altrincham in April 1999. The question was if we could estimate the premium would be for a ninety year extension to my lease. Similar flats in Altrincham with 100 year plus lease were in the region of £252,800. The average ground rent payable was £65 billed yearly. The lease came to a finish on 13 May 2091. Having 65 years unexpired we calculated the premium to the freeholder for the lease extension to be between £18,100 and £20,800 exclusive of professional charges.
Last Autumn we were contacted by Dr Aimee Morgan , who acquired a newly refurbished flat in Altrincham in July 2010. The dilemma was if we could shed any light on how much (roughly) premium could be for a 90 year lease extension. Similar properties in Altrincham with a long lease were in the region of £191,400. The mid-range amount of ground rent was £55 billed quarterly. The lease ended on 13 April 2080. Given that there were 54 years unexpired we calculated the premium to the landlord for the lease extension to be between £34,200 and £39,600 exclusive of costs.