With a long leasehold premises in Baguley, you effectively rent it for a certain period of time. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you may consider extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly especially once there are less than eighty years left. Leasehold owners in Baguley with a lease nearing 81 years unexpired should seriously think of extending it without delay. When the lease term has below 80 years outstanding, under the current legislation the landlord is entitled to calculate and charge a greater amount, assessed on a technical calculation, known as “marriage value” which is payable.
It is generally accepted that a residential leasehold with over one hundred years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 35 years left, the premises will be equivalent in value to a freehold for many years in the future.
| 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; |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
Lease extensions in Baguley can be a difficult process. We recommend you procure professional help from a conveyancing solicitor and surveyor 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 procuring Baguley lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Following unsuccessful correspondence with the freeholder of her studio flat in Baguley, Sophia started the lease extension process as the 80 year mark was rapidly coming. The lease extension was finalised in September 2009. The landlord’s costs were negotiated to slightly above 650 GBP.
Last month we were phoned by Dr I Rivera , who acquired a ground floor flat in Baguley in May 2000. We are asked if we could estimate the price would be to prolong the lease by a further 90 years. Identical flats in Baguley with a long lease were valued about £295,000. The average amount of ground rent was £45 billed annually. The lease expired in 2100. Given that there were 74 years remaining we calculated the compensation to the freeholder to extend the lease to be within £8,600 and £9,800 not including expenses.
Dr Adam Brooks took over the lease of a one bedroom flat in Baguley in January 2005. We are asked if we could approximate the compensation to the landlord would be to extend the lease by 90 years. Identical premises in Baguley with 100 year plus lease were worth £243,000. The average amount of ground rent was £65 invoiced monthly. The lease ran out in 2089. Considering the 63 years unexpired we calculated the compensation to the freeholder for the lease extension to be within £20,000 and £23,000 not including professional charges.