Maulden leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. It is the case that most Maulden tenants have the right to extend their lease by an additional 90 years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in Maulden you would be well advised to check if your lease has between seventy and ninety years left. There are compelling reasons why a Maulden leaseholder with a lease having around eighty years remaining should take action to make sure that a lease extension is actioned without delay
Leasehold properties in Maulden with more than one hundred years left on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges merit it.
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 |
| 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. |
The lawyers that we work with procure Maulden 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.
Rory owned a 2 bedroom apartment in Maulden on the market with a lease of a little over 59 years outstanding. Rory on an informal basis contacted his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent initially set at £200 per annum and increase every twenty five years thereafter. No ground rent would be payable on a lease extension were Rory to invoke his statutory right. Rory procured expert advice and secured an acceptable resolution without going to tribunal and ending up with a market value flat.
In 2009 we were called by Mr and Mrs. B Ricardo who, having acquired a recently refurbished flat in Maulden in May 2003. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be to extend the lease by ninety years. Identical properties in Maulden with an extended lease were worth £216,000. The mid-range ground rent payable was £60 invoiced monthly. The lease elapsed on 23 January 2083. Having 58 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £28,500 and £33,000 exclusive of fees.
In 2010 we were phoned by Dr Logan Reed who, having took over the lease of a basement apartment in Maulden in August 2012. We are asked if we could estimate the compensation to the landlord would be for a 90 year extension to my lease. Comparative flats in Maulden with a long lease were valued about £200,000. The mid-range ground rent payable was £50 billed per annum. The lease concluded in 2103. Given that there were 78 years outstanding we calculated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 plus expenses.