It’s a harsh truth that a Poynton residential lease is a wasting 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 Poynton property market.Once your lease gets to 85ish years, you should start considering 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 dips below 80 years - otherwise a higher premium will be payable. The majority of flat owners in Poynton will be able to extend under the legislation; however a lawyer will 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 has commenced and you will need to be guided by your lawyer from beginning to end of the process.
Leasehold properties in Poynton with over one hundred years outstanding 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 property. In such situations there is often little upside in buying the freehold unless savings on ground rent and service 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service gives you enhanced control over the value of your Poynton leasehold, as your property will be more valuable and marketable in terms 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.
After unsuccessful discussions with the freeholder of her leasehold apartment in Poynton, Millie commenced the lease extension process as the 80 year mark was quickly approaching. The lease extension completed in July 2007. The landlord’s charges were kept to an absolute minimum.
Ms W Johnson owned a one bedroom apartment in Poynton in March 1997. We are asked if we could shed any light on how much (roughly) premium would be for a ninety year extension to my lease. Comparative flats in Poynton with 100 year plus lease were worth £285,000. The average ground rent payable was £55 collected monthly. The lease ended on 24 February 2105. Considering the 80 years as a residual term we calculated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 exclusive of fees.
Last year we were contacted by Ms Niamh Lambert , who took over the lease of a garden apartment in Poynton in July 2010. The question was if we could estimate the price could be to prolong the lease by 90 years. Comparative homes in Poynton with 100 year plus lease were in the region of £200,800. The mid-range ground rent payable was £65 billed monthly. The lease expired in 2085. Considering the 60 years as a residual term we estimated the premium to the landlord for the lease extension to be between £20,900 and £24,200 exclusive of legals.