When it comes to long leasehold property in Cheadle, you are actually buying a right to reside in a property for a prescribed time frame. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you may consider extending the lease sooner rather than later. Accepted thinking is that the shorter the number of years is the cost of extending the lease becomes disproportionately greater especially when there are less than eighty years remaining. Residents in Cheadle with a lease drawing near to 81 years unexpired should seriously consider extending it without delay. When a lease has below eighty years remaining, under the current legislation the landlord is entitled to calculate and demand a larger amount, assessed on a technical multiplication, known as “marriage value” which is payable.
Leasehold residencies in Cheadle with more than 100 years remaining on the lease are sometimes 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 to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges merit it.
| 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; |
| Halifax | Minimum 70 years from the date 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Yorkshire 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. |
Regardless of whether you are a tenant or a landlord in Cheadle,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Cheadle valuers.
Jason owned a high value apartment in Cheadle being sold with a lease of just over 72 years remaining. Jason informally contacted his landlord a well known London-based freehold company for a lease extension. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £200 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Jason to invoke his statutory right. Jason obtained expert legal guidance and was able to make an informed decision and deal with the matter and sell the flat.
Last Christmas we were contacted by Mr and Mrs. V Simon , who took over the lease of a newly refurbished apartment in Cheadle in November 2009. The question was if we could approximate the premium would be for a 90 year extension to my lease. Comparative flats in Cheadle with an extended lease were worth £183,600. The average amount of ground rent was £65 collected every twelve months. The lease expired on 16 June 2083. Taking into account 57 years as a residual term we calculated the compensation to the freeholder to extend the lease to be within £28,500 and £33,000 exclusive of fees.
Mr and Mrs. C Lewis acquired a purpose-built flat in Cheadle in June 1996. The dilemma was if we could estimate the compensation to the landlord would likely be to prolong the lease by an additional years. Identical premises in Cheadle with an extended lease were worth £250,000. The average ground rent payable was £50 invoiced yearly. The lease expired on 20 October 2094. Taking into account 68 years as a residual term we estimated the premium to the landlord for the lease extension to be between £9,500 and £11,000 plus fees.