When it comes to domestic leasehold premises in Chellaston, you are actually buying a right to reside in a property for a prescribed time frame. In recent years flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you may consider extending the lease sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately more expensive notably when there are less than 80 years remaining. Leasehold owners in Chellaston with a lease nearing 81 years left should seriously think of extending it sooner than later. Once a lease has below 80 years remaining, under the current Act the landlord can calculate and levy a larger premium, based on a technical calculation, known as “marriage value” which is payable.
It is conventional wisdom that a residential leasehold with more than one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 30 years remaining, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| 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 also be not less than 75 years at the outset 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. |
The conveyancing solicitors that we work with handle Chellaston 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 conveyancer we work with provide it.
Hunter was the the leasehold owner of a 2 bedroom flat in Chellaston on the market with a lease of just over 59 years unexpired. Hunter informally approached his landlord a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £125 annually. No ground rent would be payable on a lease extension were Hunter to exercise his statutory right. Hunter procured expert advice and was able to make an informed judgement and handle with the matter and ending up with a market value flat.
In 2009 we were approached by Mr and Mrs. V Michel who, having moved into a purpose-built apartment in Chellaston in January 2002. We are asked if we could approximate the compensation to the landlord could be for a 90 year lease extension. Comparative flats in Chellaston with 100 year plus lease were worth £173,800. The mid-range ground rent payable was £60 invoiced per annum. The lease expired in 2080. Considering the 55 years unexpired we approximated the premium to the freeholder for the lease extension to be within £31,400 and £36,200 plus professional charges.
Ms R Díaz owned a purpose-built apartment in Chellaston in May 2001. The question was if we could shed any light on how much (approximately) premium would likely be to extend the lease by a further 90 years. Comparable flats in Chellaston with 100 year plus lease were valued about £235,200. The average ground rent payable was £45 collected monthly. The lease ran out in 2091. Having 66 years unexpired we calculated the compensation to the freeholder to extend the lease to be within £12,400 and £14,200 exclusive of costs.