There is no doubt about it a leasehold property in Gatley is a wasting asset as a result of the shortening lease. If the lease has, in excess of 125 years remaining then this decrease may be fractional however there will become a point in time when a lease has fewer than eighty years left as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the primary rational as to why you should consider extending sooner as opposed to later. Most flat owners in Gatley will meet the qualifying criteria; however a conveyancer should be able to confirm if you are eligible to extend your lease. In certain situations you may not qualify, the most common reason being that you have owned the property for less than two years.
It is conventional wisdom that a property with over 100 years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
The lawyers that we work with undertake Gatley 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 conveyancer we work with provide it.
Felix was the the leasehold proprietor of a high value apartment in Gatley on the market with a lease of fraction over sixty years unexpired. Felix on an informal basis contacted his freeholder a well known London-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years subject to a rise in the rent to £50 yearly. No ground rent would be payable on a lease extension were Felix to exercise his statutory right. Felix obtained expert advice and secured satisfactory resolution without resorting to tribunal and ending up with a market value flat.
In 2013 we were e-mailed by Mr and Mrs. I Hall who, having purchased a first floor apartment in Gatley in March 2011. We are asked if we could shed any light on how much (approximately) price would likely be to extend the lease by 90 years. Similar residencies in Gatley with a long lease were worth £280,000. The average ground rent payable was £45 billed every twelve months. The lease terminated on 17 July 2095. Given that there were 69 years as a residual term we calculated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 plus costs.
Mr and Mrs. B Wood completed a newly refurbished apartment in Gatley in February 1997. The question was if we could estimate the premium would be for a 90 year lease extension. Identical homes in Gatley with an extended lease were in the region of £216,000. The mid-range amount of ground rent was £60 collected yearly. The lease terminated on 24 March 2084. Having 58 years left we estimated the premium to the freeholder to extend the lease to be within £28,500 and £33,000 exclusive of expenses.