Unfortunately that a Disley residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the reduction being disguised by increases in the Disley property market.Once your lease nears 85ish years, you should start considering a lease extension. If lease term dips under 80 years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Disley will be able to extend under the legislation; however a conveyancer should be able to confirm if you are eligibility. In some cases you may not be entitled. 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 for the duration of the formalities.
It is conventional wisdom that a property with in excess of 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for decades to come.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service gives you enhanced control over the value of your Disley leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to unsuccessful correspondence with the freeholder of her basement apartment in Disley, Francesca commenced the lease extension process as the eighty year threshold was fast nearing. The lease extension was concluded in August 2011. The landlord’s fees were restricted to below 650 pounds.
Last Summer we were called by Mr and Mrs. F Torres , who purchased a basement flat in Disley in March 2007. We are asked if we could approximate the compensation to the landlord could be to extend the lease by an additional years. Identical premises in Disley with an extended lease were worth £205,000. The mid-range amount of ground rent was £50 invoiced annually. The lease ran out in 2104. Having 79 years outstanding we estimated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 exclusive of costs.
In 2010 we were e-mailed by Mr S Mercier who, having took over the lease of a basement apartment in Disley in June 2004. The dilemma was if we could shed any light on how much (approximately) price would likely be to extend the lease by an additional years. Identical residencies in Disley with a long lease were worth £275,000. The average ground rent payable was £65 collected yearly. The lease concluded on 20 February 2093. Given that there were 68 years left we estimated the premium to the freeholder to extend the lease to be between £13,300 and £15,400 not including expenses.