For anyone whose Irlam property is held on a long lease, our message is clear – if nothing is done, your property will eventually revert to your landlord, leaving you empty-handed. The fewer the years remaining the lower the value of the property and the more expensive it will be to obtain a lease extension.
It is conventional wisdom that a property with more than 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 30 years remaining, the residence will be equivalent in value to a freehold for many years ahead.
| 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. |
| 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. |
| 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. |
| Godiva Mortgages | 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Using our service will provide you enhanced control over the value of your Irlam leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last October Callum, started to get close to the eighty-year threshold with the lease on his two bedroom flat in Irlam. Having purchased his flat two decades ago, the unexpired term was of no significance. by good luck, he recognised he would imminently be paying an escalated premium for a lease extension. Callum arranged for a lease extension just under the wire in September. Callum and the freeholder subsequently agreed on the final figure of £6,000 . If the lease had gone lower than 80 years, the figure would have gone up by at least £850.
Mr and Mrs. B Lefebvre bought a newly refurbished flat in Irlam in July 1999. We are asked if we could estimate the compensation to the landlord would likely be to extend the lease by a further 90 years. Comparable properties in Irlam with a long lease were valued about £254,200. The average amount of ground rent was £60 invoiced annually. The lease came to a finish on 19 August 2076. Having 51 years as a residual term we approximated the compensation to the freeholder to extend the lease to be between £43,700 and £50,600 exclusive of professional charges.
In 2013 we were contacted by Dr V Nguyen who, having acquired a first floor flat in Irlam in July 2010. The dilemma was if we could estimate the price would be for a 90 year extension to my lease. Comparative properties in Irlam with a long lease were in the region of £210,600. The mid-range amount of ground rent was £45 collected quarterly. The lease termination date was on 28 June 2087. Taking into account 62 years remaining we calculated the premium to the freeholder to extend the lease to be between £18,100 and £20,800 not including legals.