For those whose Cheetham flat is held on a long lease, our message is clear – if no remedial action is taken, your property will ultimately revert to your landlord, leaving you empty-handed. The shorter the lease the lower the value of the property and the more expensive it will be to procure a lease extension.
It is generally accepted that a residential leasehold with over 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with undertake Cheetham lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Kai was the the leasehold proprietor of a high value apartment in Cheetham on the market with a lease of fraction over 59 years unexpired. Kai informally spoke with his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £100 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Kai to invoke his statutory right. Kai obtained expert advice and was able to make a more informed judgement and deal with the matter and readily saleable.
In 2013 we were e-mailed by Ms Yasmin Reed who, having owned a newly refurbished apartment in Cheetham in November 2008. We are asked if we could estimate the price could be to extend the lease by ninety years. Comparable premises in Cheetham with an extended lease were worth £240,600. The average amount of ground rent was £65 invoiced annually. The lease terminated on 18 March 2087. Taking into account 62 years unexpired we calculated the premium to the landlord for the lease extension to be between £21,900 and £25,200 not including expenses.
Last Winter we were approach by Mr N Roberts , who acquired a one bedroom flat in Cheetham in September 2005. We are asked if we could shed any light on how much (approximately) price could be to prolong the lease by 90 years. Similar homes in Cheetham with a long lease were in the region of £179,200. The mid-range amount of ground rent was £55 billed yearly. The lease ended on 12 May 2076. Given that there were 51 years outstanding we approximated the compensation to the landlord for the lease extension to be within £31,400 and £36,200 plus expenses.