As the length of the unexpired term of a Chester residential lease lessens so does its value and therefore the value of your property. If the lease has, beyond 125 years to run then this decrease may be fractional that being said there will become a stage when a lease has less than 80 years remaining as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the primary reason why you should consider extending without delay. Many flat owners in Chester will qualify for this right; nevertheless a conveyancing solicitor can confirm whether you are eligible to extend your lease. In certain situations you may not qualify, the most common reason being that you have owned the property for under two years.
Leasehold properties in Chester with over 100 years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges justify 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| 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. |
| 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 freeholder in Chester,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 experience and the close ties they enjoy with Chester valuers.
Subsequent to protracted discussions with the landlord of her two bedroom apartment in Chester, Ellen started the lease extension process as the 80 year threshold was quickly nearing. The legal work was finalised in April 2011. The freeholder’s costs were negotiated to about 600 pounds.
Ms Sarah Roux acquired a ground floor flat in Chester in February 2002. The dilemma was if we could shed any light on how much (roughly) premium would be for a 90 year extension to my lease. Identical flats in Chester with 100 year plus lease were worth £280,000. The mid-range ground rent payable was £45 collected monthly. The lease came to a finish on 2 October 2097. Given that there were 71 years remaining we approximated the premium to the landlord for the lease extension to be between £12,400 and £14,200 not including expenses.
Last Summer we were approach by Mr B Ali , who owned a first floor apartment in Chester in March 2006. We are asked if we could approximate the price could be to extend the lease by an additional years. Comparable residencies in Chester with a long lease were worth £225,800. The mid-range amount of ground rent was £60 billed every twelve months. The lease expiry date was in 2086. Considering the 60 years remaining we calculated the premium to the freeholder for the lease extension to be within £25,700 and £29,600 exclusive of costs.