The market value of Arnold leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can escalate significantly once the unexpired lease term is below than 80 years
Leasehold premises in Arnold with over 100 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 premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate 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. |
| 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; |
| 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. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Lease extensions in Arnold can be a difficult process. We recommend you obtain guidance from a conveyancing solicitor and valuer with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Arnold lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
David was the the leasehold owner of a high value apartment in Arnold being sold with a lease of just over 61 years remaining. David on an informal basis approached his landlord a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent at the outset set at £150 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were David to invoke his statutory right. David obtained expert advice and secured satisfactory resolution informally and readily saleable.
Mr and Mrs. W Norbert purchased a one bedroom apartment in Arnold in July 1999. We are asked if we could estimate the compensation to the landlord would be for a 90 year lease extension. Comparative residencies in Arnold with a long lease were worth £200,000. The mid-range ground rent payable was £50 billed annually. The lease ran out on 11 March 2103. Taking into account 78 years unexpired we calculated the compensation to the landlord to extend the lease to be within £8,600 and £9,800 not including professional charges.
Dr Jade Díaz moved into a one bedroom apartment in Arnold in March 1995. The question was if we could estimate the premium could be for a ninety year extension to my lease. Comparable premises in Arnold with a long lease were worth £267,600. The average ground rent payable was £65 billed monthly. The lease ran out in 2092. Considering the 67 years remaining we calculated the compensation to the freeholder to extend the lease to be within £14,300 and £16,400 exclusive of fees.