The market value of Irlam leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can increase materialy once the unexpired lease term is less than eighty years
Leasehold properties in Irlam with over one hundred years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges justify it.
| 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. |
| 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Yorkshire 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. |
The lawyers that we work with handle Irlam 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.
Edward was the the leasehold proprietor of a conversion apartment in Irlam being marketed with a lease of fraction over 59 years left. Edward informally contacted his freeholder a well known Bristol-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 new rent to start with set at £200 per annum and doubled every twenty five years thereafter. No ground rent would be payable on a lease extension were Edward to invoke his statutory right. Edward obtained expert legal guidance and was able to make an informed judgement and deal with the matter and sell the property.
In 2011 we were phoned by Mr and Mrs. D Smith who, having took over the lease of a one bedroom flat in Irlam in January 2001. The question was if we could approximate the price would be for a 90 year extension to my lease. Comparable residencies in Irlam with 100 year plus lease were valued around £168,800. The average ground rent payable was £60 invoiced annually. The lease finished on 8 May 2080. Considering the 55 years left we estimated the compensation to the landlord for the lease extension to be between £31,400 and £36,200 exclusive of legals.
In 2009 we were approached by Dr Y Cook who, having acquired a ground floor apartment in Irlam in August 1997. The question was if we could shed any light on how much (approximately) price could be for a ninety year extension to my lease. Similar homes in Irlam with 100 year plus lease were valued around £235,200. The mid-range amount of ground rent was £45 billed per annum. The lease came to a finish on 21 November 2091. Having 66 years left we estimated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 not including professional charges.