It’s an underpublicised truth that a Glossop residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Glossop property market.Where your lease has approximately 90 years left, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls lower than eighty years - otherwise a higher amount will be payable. Most flat owners in Glossop will be able to extend under the legislation; however a lawyer should be able to clarify whether you are eligibility. In some cases you may not qualify. There are also strict deadlines and procedures to follow once the process is initiated and you will need to be guided by your conveyancing solicitor from beginning to end of the process.
It is conventional wisdom that a property with over one hundred years remaining is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Accord Mortgages | |
| National Westminster Bank | |
| Nationwide Building Society | |
| The Mortgage Works | |
| Royal Bank of Scotland |
The conveyancers that we work with handle Glossop 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 conveyancing solicitor we work with provide it.
In recent months William, came perilously close to the eighty-year threshold with the lease on his studio flat in Glossop. Having bought his flat 18 years ago, the lease term was of little bearing. Fortunately, he recognised he would soon be paying an inflated amount for Extending the lease. William was able to extend his lease just under the wire in June. William and the landlord who owned the flat above ultimately agreed on the final figure of £5,500 . If the lease had slid to less than eighty years, the price would have escalated by a minimum £1,100.
In 2011 we were contacted by Mr H Michel who, having completed a purpose-built flat in Glossop in March 2001. The question was if we could estimate the price would be for a ninety year lease extension. Identical properties in Glossop with an extended lease were worth £275,000. The mid-range ground rent payable was £55 invoiced yearly. The lease lapsed on 5 March 2102. Considering the 76 years remaining we estimated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 plus expenses.
In 2012 we were contacted by Mr and Mrs. R Nelson who, having moved into a one bedroom apartment in Glossop in May 2003. The dilemma was if we could shed any light on how much (roughly) premium would be to extend the lease by an additional years. Comparative properties in Glossop with an extended lease were worth £176,200. The average amount of ground rent was £65 billed yearly. The lease expired on 1 October 2082. Given that there were 56 years unexpired we approximated the compensation to the landlord to extend the lease to be within £29,500 and £34,000 plus expenses.