Chorlton leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Legislation has been in place for sometime now which permits qualifying Chorlton residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Chorlton you really ought to see if your lease has between 70 and 90 years left. In particular once the remaining lease term slips under eighty years, the compensation to the landlord for any lease extension sharply increases as part of the premium you will incur is what is known as a marriage value
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 30 years unexpired, the residence will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| Godiva Mortgages | 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. |
| 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. |
| 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 |
Irrespective of whether you are a tenant or a freeholder in Chorlton,the lease extension solicitors 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 Chorlton valuers.
Twenty four months ago Alfie, came very near to the 80-year mark with the lease on his first floor flat in Chorlton. In buying his flat two decades ago, the length of the lease was of no significance. Fortunately, he recognised he needed to take steps soon on Extending the lease. Alfie arranged for a lease extension just in the nick of time last July. Alfie and the freeholder ultimately agreed on an amount of £6,000 . If he had missed the deadline, the figure would have gone up by a minimum £1,025.
Dr Bethany Turner took over the lease of a ground floor apartment in Chorlton in July 2007. We are asked if we could estimate the compensation to the landlord could be for a ninety year extension to my lease. Identical residencies in Chorlton with an extended lease were valued about £227,800. The mid-range amount of ground rent was £45 invoiced per annum. The lease elapsed on 28 October 2090. Having 65 years unexpired we approximated the compensation to the freeholder to extend the lease to be between £13,300 and £15,400 plus expenses.
Mr and Mrs. P André bought a first floor apartment in Chorlton in January 1996. We are asked if we could shed any light on how much (approximately) price would likely be to extend the lease by ninety years. Comparable homes in Chorlton with a long lease were valued around £275,000. The average amount of ground rent was £55 collected yearly. The lease elapsed on 26 June 2101. Having 76 years unexpired we estimated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 plus legals.