Unfortunately that a Heath residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the depreciation being disguised by increases in the Heath property prices.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. If the number of years remaining falls under eighty years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property The majority of leasehold owners in Heath will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify if you qualify for an extension. In some cases you may not qualify. There are also strict timetables and procedures to follow once the process is instigated and you will need to be guided by your lawyer from beginning to end of the process.
Leasehold properties in Heath with over one hundred years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and service charges warrant it.
Lender | Requirement |
---|---|
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. |
National Westminster Bank | Mortgage term plus 30 years. |
TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Royal Bank of Scotland | Mortgage term plus 30 years. |
Engaging our service gives you better control over the value of your Heath leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Alex was the the leasehold proprietor of a conversion flat in Heath being marketed with a lease of fraction over 72 years unexpired. Alex informally contacted his freeholder being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £200 per annum. No ground rent would be payable on a lease extension were Alex to exercise his statutory right. Alex obtained expert legal guidance and secured an acceptable deal without resorting to tribunal and sell the flat.
Last Spring we were called by Mr and Mrs. H Garcia , who took over the lease of a one bedroom flat in Heath in November 1995. The dilemma was if we could estimate the price would be to prolong the lease by an additional years. Comparable premises in Heath with an extended lease were valued about £225,800. The mid-range ground rent payable was £60 invoiced every twelve months. The lease elapsed in 2085. Having 60 years unexpired we approximated the premium to the freeholder for the lease extension to be between £23,800 and £27,400 not including legals.
Last Spring we were contacted by Mr and Mrs. J Moreau , who owned a purpose-built flat in Heath in March 2002. The dilemma was if we could approximate the compensation to the landlord could be to extend the lease by ninety years. Comparable homes in Heath with a long lease were valued around £210,000. The average ground rent payable was £50 collected annually. The lease ended in 2105. Having 80 years unexpired we estimated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 exclusive of fees.