Hulme residential property held on a long lease is a depreciating asset as the leaseholder merely owns the property for a period of years.
It is generally accepted that a property with more than 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the residence 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Chelsea Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
| 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. |
| Godiva Mortgages | 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. |
Retaining our service gives you enhanced control over the value of your Hulme leasehold, as your property will be more valuable and saleable in respect of lease length should you wish to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Following lengthy correspondence with the landlord of her ground floor flat in Hulme, Tia commenced the lease extension process as the eighty year mark was swiftly nearing. The lease extension was finalised in January 2006. The freeholder’s costs were restricted to slightly above 550 GBP.
Last month we were contacted by Dr Harvey Dupont , who acquired a studio flat in Hulme in August 2004. The question was if we could approximate the premium would likely be for a ninety year lease extension. Comparable flats in Hulme with a long lease were valued around £174,200. The mid-range amount of ground rent was £55 collected monthly. The lease concluded in 2077. Given that there were 51 years outstanding we estimated the compensation to the freeholder to extend the lease to be between £31,400 and £36,200 exclusive of expenses.
Last month we were approach by Mr Alexander Watson , who owned a studio apartment in Hulme in March 1999. We are asked if we could approximate the price would be for a 90 year extension to my lease. Comparable homes in Hulme with 100 year plus lease were valued around £285,000. The average ground rent payable was £45 collected every twelve months. The lease finished on 8 October 2097. Taking into account 71 years as a residual term we estimated the compensation to the landlord for the lease extension to be between £12,400 and £14,200 plus professional charges.