When it comes to domestic leasehold premises in Chadderton, you are actually buying an entitlement to live in a property for a prescribed time frame. Modern flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you should think about extending the lease sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease increases markedly notably when there are less than 80 years remaining. Leasehold owners in Chadderton with a lease nearing 81 years left should seriously think of extending it sooner as opposed to later. Once a lease has fewer than 80 years outstanding, under the current statute the landlord is entitled to calculate and levy a larger amount, assessed on a technical calculation, known as “marriage value” which is due.
It is conventional wisdom that a property with more than 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 35 years unexpired, the premises will be equivalent in value to a freehold for decades to come.
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Using our service gives you enhanced control over the value of your Chadderton leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Evan owned a conversion apartment in Chadderton being marketed with a lease of just over fifty eight years remaining. Evan informally spoke with his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £200 annually. Ordinarily, ground rent would not be due on a lease extension were Evan to exercise his statutory right. Evan obtained expert advice and secured satisfactory deal without resorting to tribunal and sell the flat.
Last Winter we were e-mailed by Mr and Mrs. B Morgan , who was assigned a lease of a recently refurbished flat in Chadderton in November 1998. We are asked if we could estimate the price could be for a ninety year extension to my lease. Comparative properties in Chadderton with 100 year plus lease were valued around £193,400. The average amount of ground rent was £65 billed every twelve months. The lease terminated on 25 September 2084. Taking into account 59 years left we calculated the compensation to the freeholder for the lease extension to be within £21,900 and £25,200 plus costs.
Last Christmas we were contacted by Mr I Hill , who moved into a one bedroom apartment in Chadderton in August 2004. We are asked if we could approximate the premium could be for a ninety year extension to my lease. Similar flats in Chadderton with an extended lease were worth £255,000. The average amount of ground rent was £50 invoiced every twelve months. The lease finished in 2095. Given that there were 70 years remaining we calculated the premium to the landlord to extend the lease to be between £10,500 and £12,000 exclusive of fees.