It’s a harsh certainty that a Chester residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Chester property market.Once your lease gets to 85ish years, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls under eighty years - otherwise a higher amount will be due. Most flat owners in Chester will be able to extend under the legislation; however a conveyancer should be able to clarify whether you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
Leasehold properties in Chester with over one hundred 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 home. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | |
| Barclays plc | |
| Halifax | |
| National Westminster Bank | |
| Royal Bank of Scotland |
The lawyers that we work with handle Chester lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancing solicitor we work with provide it.
Dexter owned a high value flat in Chester being marketed with a lease of fraction over 72 years unexpired. Dexter informally contacted his landlord being a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to an increased rent to £125 per annum. No ground rent would be payable on a lease extension were Dexter to invoke his statutory right. Dexter procured expert legal guidance and was able to make a more informed judgement and deal with the matter and ending up with a market value flat.
In 2009 we were e-mailed by Mr and Mrs. R Johnson who, having took over the lease of a one bedroom flat in Chester in August 2004. We are asked if we could shed any light on how much (approximately) price would likely be to prolong the lease by 90 years. Identical properties in Chester with an extended lease were worth £198,800. The mid-range amount of ground rent was £55 collected monthly. The lease finished in 2081. Having 55 years unexpired we approximated the premium to the freeholder to extend the lease to be between £33,300 and £38,400 not including professional charges.
Last Autumn we were phoned by Ms S Campbell , who purchased a garden apartment in Chester in February 2003. We are asked if we could estimate the price would be to extend the lease by 90 years. Similar flats in Chester with 100 year plus lease were in the region of £295,000. The mid-range amount of ground rent was £45 billed every twelve months. The lease termination date was in 2101. Having 75 years remaining we approximated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 plus professional charges.