Chorlton leases on residential properties are gradually losing value. Where your lease has approximately 90 years unexpired, you should start thinking about a lease extension. If lease term dips under eighty years, you will then have to pay half of the property's 'marriage value' in addition to the standard cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Leasehold owners in Chorlton will mostly qualify for a lease extension; however a solicitor should be able confirm your eligibility. In some circumstances you may not qualify. There are prescribed timetables and formalities to comply with once the process is triggered so it’s wise to be guided by a lawyer during the process.
It is conventional wisdom that a property with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
Regardless of whether you are a tenant or a freeholder in Chorlton,the lease extension experts that we work with will always be happy 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.
Jake owned a high value apartment in Chorlton on the market with a lease of fraction over sixty years left. Jake informally spoke with his landlord a well known Manchester-based freehold company for a lease extension. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent at the outset set at £200 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Jake to exercise his statutory right. Jake procured expert advice and secured satisfactory deal informally and ending up with a market value flat.
Last month we were phoned by Mrs Courtney Morgan , who bought a one bedroom flat in Chorlton in April 2000. The question was if we could estimate the price would be for a ninety year extension to my lease. Comparative premises in Chorlton with a long lease were worth £183,600. The mid-range amount of ground rent was £65 collected annually. The lease elapsed in 2081. Given that there were 57 years remaining we calculated the compensation to the freeholder to extend the lease to be between £28,500 and £33,000 not including costs.
In 2010 we were e-mailed by Mr N François who, having bought a ground floor apartment in Chorlton in November 2006. We are asked if we could approximate the price could be for a ninety year extension to my lease. Similar homes in Chorlton with a long lease were worth £245,000. The mid-range ground rent payable was £50 invoiced every twelve months. The lease termination date was on 9 February 2092. Having 68 years remaining we approximated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 exclusive of professional charges.