Disley residential property owned on a long lease is a depreciating asset as the leaseholder only owns the property for a period of years.
Leasehold residencies in Disley with more than 100 years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with procure Disley 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 lawyer we work with provide it.
Off the back of protracted correspondence with the landlord of her studio flat in Disley, Jennifer started the lease extension process as the eighty year deadline was fast advancing. The legal work was concluded in June 2007. The freeholder’s charges were restricted to below 550 GBP.
In 2011 we were phoned by Mr and Mrs. W André who, having owned a garden flat in Disley in November 2004. We are asked if we could approximate the price would likely be for a 90 year extension to my lease. Similar premises in Disley with 100 year plus lease were in the region of £295,000. The average ground rent payable was £50 invoiced per annum. The lease ran out in 2100. Considering the 75 years outstanding we calculated the premium to the landlord to extend the lease to be within £8,600 and £9,800 plus fees.
Dr G Flores acquired a ground floor flat in Disley in July 1999. We are asked if we could shed any light on how much (approximately) price would be to prolong the lease by ninety years. Identical premises in Disley with a long lease were valued about £250,400. The average amount of ground rent was £65 collected yearly. The lease expired in 2089. Considering the 64 years outstanding we estimated the premium to the landlord to extend the lease to be between £19,000 and £22,000 exclusive of fees.