With a residential leasehold property in Ellesmere Port, you are actually purchasing a right to reside in a property for a set period of time. In recent years flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you should consider extending the lease sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly notably once there are fewer than 80 years remaining. Leasehold owners in Ellesmere Port with a lease nearing 81 years left should seriously think of extending it as soon as possible. When a lease has less than eighty years outstanding, under the relevant legislation the landlord is entitled to calculate and levy a greater premium, assessed on a technical computation, strangely termed as “marriage value” which is payable.
Leasehold properties in Ellesmere Port with over one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges merit 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. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you enhanced control over the value of your Ellesmere Port leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last October Liam, started to get close to the eighty-year threshold with the lease on his basement flat in Ellesmere Port. In buying his property 19 years ago, the unexpired term was of minimal interest. Fortunately, it dawned on him that he needed to take steps soon on a lease extension. Liam was able to extend his lease just under the wire in July. Liam and the freeholder eventually settled on sum of £6,000 . If the lease had fallen to less than 80 years, the figure would have become more exhorbitant by a minimum £900.
Last Autumn we were e-mailed by Mrs R Phillips , who completed a basement flat in Ellesmere Port in January 2006. The question was if we could shed any light on how much (roughly) compensation to the landlord would be to prolong the lease by a further 90 years. Comparable residencies in Ellesmere Port with a long lease were valued around £233,200. The average ground rent payable was £60 collected monthly. The lease terminated in 2087. Considering the 61 years left we approximated the premium to the freeholder for the lease extension to be within £22,800 and £26,400 exclusive of professional charges.
In 2014 we were phoned by Dr Luke Gómez who, having took over the lease of a studio apartment in Ellesmere Port in November 2006. The question was if we could approximate the compensation to the landlord would be for a ninety year lease extension. Comparable properties in Ellesmere Port with a long lease were valued about £166,800. The average amount of ground rent was £50 collected every twelve months. The lease terminated in 2076. Taking into account 50 years unexpired we calculated the compensation to the freeholder for the lease extension to be within £32,300 and £37,400 plus professional charges.