Chorley leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. The majority of owners of residential leasehold property in Chorley enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Chorley you really ought to see if your lease has between 70 and ninety years remaining. There are good reasons why a Chorley flat owner with a lease having around 80 years remaining should take steps to make sure that a lease extension is actioned without delay
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years unexpired, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Engaging our service gives you better control over the value of your Chorley leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last October Jackson, came dangerously close to the eighty-year threshold with the lease on his ground floor apartment in Chorley. In buying his flat two decades ago, the length of the lease was of minimal bearing. Thankfully, it dawned on him that he needed to take steps soon on a lease extension. Jackson arranged for a lease extension at the eleventh hour last April. Jackson and the landlord who owned the flat above ultimately settled on sum of £5,000 . If the lease had slipped below 80 years, the sum would have gone up by a minimum £1,125.
Last March we were approach by Mrs Sophie Rose , who moved into a basement apartment in Chorley in September 2009. The dilemma was if we could estimate the premium could be for a 90 year extension to my lease. Similar homes in Chorley with 100 year plus lease were worth £181,600. The average amount of ground rent was £55 billed quarterly. The lease concluded in 2077. Taking into account 52 years left we calculated the premium to the landlord to extend the lease to be within £30,400 and £35,200 exclusive of costs.
Last month we were phoned by Dr J Girard , who was assigned a lease of a ground floor apartment in Chorley in May 2012. We are asked if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Comparable homes in Chorley with a long lease were valued around £285,000. The mid-range amount of ground rent was £45 billed every twelve months. The lease came to a finish in 2097. Taking into account 72 years remaining we approximated the compensation to the landlord to extend the lease to be between £12,400 and £14,200 not including fees.