The nearer a residential lease in Prestwich nears to zero years unexpired, the the greater the reduction in the value of the property. Where the residual term has, over 125 years remaining then this decrease may be fractional that being said there will become a stage when a lease has less than eighty years left as part of the premium you will incur is what is known as a marriage value. This could increase sharply the cost. It is the primary logic behind why you should extend the lease sooner rather than later. The majority of flat owners in Prestwich will qualify for this right; however a conveyancer should be able to advise if you are eligible to extend your lease. In certain situations you may not qualify, the most common reason being that you have owned the property for less than two years.
Leasehold properties in Prestwich with in excess of one hundred years left on the lease are often regarded as a ‘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 purchasing the freehold unless savings on ground rent and service charges justify 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
Engaging our service gives you enhanced control over the value of your Prestwich leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In the wake of 9 months of lengthy discussions with the freeholder of her garden flat in Prestwich, Eleanor initiated the lease extension process just as her lease was coming close to the crucial eighty-year threshold. The legal work was finalised in March 2013. The freeholder’s fees were negotiated to approximately 700 GBP.
In 2014 we were phoned by Mrs L Davis who, having took over the lease of a first floor flat in Prestwich in November 2007. We are asked if we could approximate the price would likely be for a ninety year extension to my lease. Similar flats in Prestwich with an extended lease were worth £290,000. The mid-range ground rent payable was £45 billed per annum. The lease expired in 2097. Considering the 72 years outstanding we estimated the premium to the freeholder to extend the lease to be between £11,400 and £13,200 exclusive of professional charges.
In 2009 we were called by Mr and Mrs. C Peterson who, having acquired a studio flat in Prestwich in September 1996. We are asked if we could shed any light on how much (approximately) price would be to extend the lease by 90 years. Identical flats in Prestwich with a long lease were worth £233,200. The mid-range amount of ground rent was £60 invoiced every twelve months. The lease terminated in 2086. Taking into account 61 years outstanding we calculated the premium to the freeholder for the lease extension to be within £22,800 and £26,400 exclusive of costs.