It’s an underpublicised certainty that a Stretford residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the Stretford property prices.Once your lease gets to 85ish years, you need to 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 slips below eighty years - otherwise a higher premium will be payable. Most leasehold owners in Stretford will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify if you qualify for an extension. In some cases you may not qualify. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your lawyer throughout the process.
Leasehold premises in Stretford with in excess of one hundred years left on the lease are sometimes 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 estate charges warrant 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
Irrespective of whether you are a tenant or a freeholder in Stretford,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Stretford valuers.
Felix owned a conversion apartment in Stretford being sold with a lease of fraction over sixty years unexpired. Felix on an informal basis approached his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years subject to an increased rent to £50 yearly. Ordinarily, ground rent would not be payable on a lease extension were Felix to invoke his statutory right. Felix procured expert legal guidance and secured satisfactory deal without going to tribunal and ending up with a market value flat.
Mr Mason Moreau completed a first floor apartment in Stretford in November 1999. The question was if we could estimate the premium would be for a ninety year lease extension. Comparable premises in Stretford with 100 year plus lease were in the region of £285,000. The average amount of ground rent was £55 billed per annum. The lease finished on 26 February 2104. Given that there were 79 years remaining we calculated the premium to the landlord to extend the lease to be within £13,300 and £15,400 plus costs.
Ms V Cook purchased a one bedroom apartment in Stretford in February 2004. The dilemma was if we could approximate the premium would be for a ninety year lease extension. Comparable residencies in Stretford with a long lease were worth £193,400. The mid-range amount of ground rent was £65 invoiced per annum. The lease ran out in 2084. Having 59 years remaining we calculated the premium to the landlord for the lease extension to be within £21,900 and £25,200 plus professional charges.