Chances are that where you own a flat in Alderley Edge you actually own a long leasehold interest over your property
It is conventional wisdom that a property with more than one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for decades to come.
| 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Using our service will provide you enhanced control over the value of your Alderley Edge leasehold, as your property will be more valuable and saleable in respect of lease length should you decide to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to protracted correspondence with the freeholder of her ground floor apartment in Alderley Edge, Emily initiated the lease extension process just as the lease was coming close to the critical eighty-year deadline. The transaction was concluded in February 2015. The landlord’s fees were negotiated to approximately 500 GBP.
Last Summer we were contacted by Mr A Johnson , who owned a ground floor apartment in Alderley Edge in February 2006. The question was if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Comparable properties in Alderley Edge with 100 year plus lease were worth £203,200. The average ground rent payable was £65 billed every twelve months. The lease finished in 2087. Having 61 years left we estimated the premium to the freeholder to extend the lease to be within £19,000 and £22,000 exclusive of costs.
Last year we were phoned by Mr and Mrs. V Khan , who owned a first floor flat in Alderley Edge in May 1998. The question was if we could shed any light on how much (roughly) compensation to the landlord would be to prolong the lease by ninety years. Similar residencies in Alderley Edge with 100 year plus lease were worth £260,000. The average ground rent payable was £50 collected per annum. The lease terminated in 2098. Considering the 72 years remaining we calculated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 not including costs.