Unfortunately that a Bury 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 Bury property prices.Once your lease nears 85ish years, you need to start thinking about a lease extension. If the number of years remaining falls below 80 years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property Most flat owners in Bury will be able to extend under the legislation; however a lawyer will be able to clarify whether you are eligibility. In some situations you may not qualify. There are also strict timetables and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer from beginning to end of the formalities.
Leasehold premises in Bury with over 100 years unexpired 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 buying the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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 Bury can be a difficult process. We recommend you secure guidance 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 Bury lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Ben was the the leasehold proprietor of a conversion apartment in Bury being marketed with a lease of fraction over 59 years unexpired. Ben informally spoke with his freeholder being a well known London-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent initially set at £200 per annum and increase every twenty five years thereafter. No ground rent would be payable on a lease extension were Ben to exercise his statutory right. Ben obtained expert advice and was able to make an informed judgement and handle with the matter and ending up with a market value flat.
Ms Sophia Brown took over the lease of a purpose-built apartment in Bury in November 2004. The dilemma was if we could shed any light on how much (roughly) premium would be to prolong the lease by a further 90 years. Comparable premises in Bury with an extended lease were valued around £181,600. The average amount of ground rent was £55 billed per annum. The lease lapsed in 2077. Given that there were 52 years left we estimated the premium to the landlord for the lease extension to be between £30,400 and £35,200 exclusive of professional charges.
Last year we were called by Dr G Cook , who moved into a one bedroom apartment in Bury in May 2001. The question was if we could shed any light on how much (approximately) premium would be for a ninety year lease extension. Similar premises in Bury with 100 year plus lease were valued about £290,000. The average ground rent payable was £45 billed yearly. The lease termination date was on 13 April 2097. Given that there were 72 years left we calculated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 not including expenses.