Unfortunately that a Heywood residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the Heywood property prices.Once your lease nears 85ish years, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls under 80 years - otherwise a higher amount will be payable. Most flat owners in Heywood will be able to extend under the legislation; however a conveyancer should be able to confirm whether you qualify for an extension. In some cases you may not qualify. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer throughout the formalities.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an further ninety 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 |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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 Heywood 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 lengthy discussions with the landlord of her one bedroom apartment in Heywood, Maisie started the lease extension process just as the lease was approaching the crucial eighty-year threshold. The transaction was finalised in October 2015. The freeholder’s fees were kept to an absolute minimum.
In 2014 we were called by Ms Amelia Díaz who, having owned a basement apartment in Heywood in November 1999. We are asked if we could shed any light on how much (approximately) price would likely be to prolong the lease by a further 90 years. Comparative premises in Heywood with an extended lease were worth £218,000. The average ground rent payable was £45 billed monthly. The lease expired on 28 November 2088. Having 63 years remaining we approximated the compensation to the freeholder for the lease extension to be between £17,100 and £19,800 plus legals.
Dr S Stewart completed a ground floor flat in Heywood in November 2000. The dilemma was if we could approximate the price would likely be to extend the lease by a further 90 years. Comparative properties in Heywood with an extended lease were worth £270,000. The average amount of ground rent was £55 invoiced monthly. The lease came to a finish in 2099. Having 74 years remaining we calculated the premium to the landlord to extend the lease to be within £9,500 and £11,000 exclusive of expenses.