With a domestic leasehold premises in Manchester, you are in fact renting it for a certain amount of time. These days flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you should consider extending the lease sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly especially once there are fewer than 80 years left. Residents in Manchester with a lease drawing near to 81 years remaining should seriously think of extending it without delay. When the lease term has less than 80 years left, under the relevant Act the freeholder can calculate and levy a greater premium, assessed on a technical computation, known as “marriage value” which is payable.
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 45 years unexpired, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Manchester,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Manchester valuers.
Following unsuccessful correspondence with the landlord of her studio flat in Manchester, Tia initiated the lease extension process just as her lease was coming close to the crucial eighty-year deadline. The legal work was concluded in September 2005. The freeholder’s fees were negotiated to below 650 pounds.
Last Winter we were phoned by Mr Jasper Bennett , who acquired a studio apartment in Manchester in September 2002. The question was if we could shed any light on how much (roughly) premium could be to prolong the lease by ninety years. Comparative homes in Manchester with an extended lease were worth £208,200. The average ground rent payable was £65 billed annually. The lease lapsed in 2087. Taking into account 61 years outstanding we approximated the premium to the landlord for the lease extension to be within £20,000 and £23,000 exclusive of professional charges.
Mr Austin Roberts bought a purpose-built flat in Manchester in February 2006. The question was if we could approximate the compensation to the landlord would be to prolong the lease by 90 years. Comparative homes in Manchester with an extended lease were in the region of £260,000. The mid-range ground rent payable was £50 billed yearly. The lease ended on 21 September 2098. Having 72 years outstanding we approximated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 not including expenses.