With a residential leasehold premises in Heath Hayes, you are actually purchasing an entitlement to live in a property for a prescribed time frame. In recent years flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you should consider a lease extension sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease gets disproportionately more expensive particularly when there are less than 80 years left. Anyone in Heath Hayes with a lease drawing near to 81 years remaining should seriously think of extending it sooner as opposed to later. Once a lease has below 80 years left, under the relevant statute the landlord is entitled to calculate and charge a greater premium, assessed on a technical computation, strangely termed as “marriage value” which is due.
Leasehold properties in Heath Hayes with over 100 years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges justify it.
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 |
Using our service will provide you better control over the value of your Heath Hayes leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide 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.
John owned a 2 bedroom flat in Heath Hayes being sold with a lease of a little over sixty years left. John on an informal basis contacted his landlord a well known Manchester-based freehold company for a lease extension. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent initially set at £150 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were John to invoke his statutory right. John procured expert advice and secured an acceptable deal without going to tribunal and sell the property.
In 2013 we were approached by Mr and Mrs. N White who, having bought a first floor flat in Heath Hayes in May 2010. We are asked if we could shed any light on how much (approximately) premium would likely be for a 90 year lease extension. Similar residencies in Heath Hayes with a long lease were in the region of £210,000. The mid-range ground rent payable was £50 collected per annum. The lease termination date was on 7 August 2105. Having 80 years left we approximated the compensation to the landlord for the lease extension to be within £8,600 and £9,800 plus expenses.
In 2013 we were contacted by Dr Olivia Torres who, having acquired a one bedroom flat in Heath Hayes in September 1996. We are asked if we could approximate the compensation to the landlord would be for a 90 year extension to my lease. Identical flats in Heath Hayes with 100 year plus lease were worth £275,000. The average amount of ground rent was £45 collected per annum. The lease came to a finish in 2094. Having 69 years remaining we calculated the compensation to the freeholder for the lease extension to be within £12,400 and £14,200 not including costs.