There is no doubt about it a leasehold flat or house in Alsager is a wasting asset as a result of the diminishing lease term. If the lease has, over 99 years remaining then this decrease may be fractional nevertheless there will become a stage when a lease has fewer than eighty years left as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the primary rational as to why you should consider extending without delay. Many flat owners in Alsager will qualify for this right; however a conveyancer will be able to confirm if you are eligible to extend your lease. In limited situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
It is conventional wisdom that a property with over 100 years remaining is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for many years ahead.
| 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. |
| 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; |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service gives you increased control over the value of your Alsager leasehold, as your property will be more valuable and marketable in respect 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.
In recent months Ali, started to get near to the eighty-year threshold with the lease on his ground floor flat in Alsager. In buying his flat two decades ago, the length of the lease was of no relevance. Luckily, he realised he needed to take action soon on a lease extension. Ali arranged for a lease extension just under the wire in April. Ali and the landlord subsequently agreed on the final figure of £6,000 . If the lease had dipped below eighty years, the premium would have become more costly by a minimum £850.
Last Winter we were approach by Mr Y García , who took over the lease of a basement apartment in Alsager in April 2012. The question was if we could shed any light on how much (approximately) compensation to the landlord would likely be to extend the lease by an additional years. Comparative premises in Alsager with 100 year plus lease were valued around £174,200. The average amount of ground rent was £55 billed yearly. The lease terminated in 2077. Having 51 years as a residual term we estimated the compensation to the freeholder to extend the lease to be within £31,400 and £36,200 not including professional charges.
In 2014 we were e-mailed by Dr Michael Morgan who, having acquired a garden apartment in Alsager in November 2002. We are asked if we could estimate the premium would be for a 90 year lease extension. Similar premises in Alsager with a long lease were in the region of £280,000. The average ground rent payable was £45 invoiced per annum. The lease terminated on 12 May 2097. Given that there were 71 years outstanding we estimated the compensation to the landlord to extend the lease to be between £12,400 and £14,200 plus costs.