There is no doubt about it a leasehold flat or house in Knutsford is a wasting asset as a result of the shortening lease. Where the residual term has, beyond 99 years remaining then this decrease may be negligible however there will become a point in time when a lease has less than eighty years unexpired as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the primary logic behind why you should extend the lease sooner as opposed to later. Many flat owners in Knutsford will qualify for this right; nevertheless a lawyer should be able to advise whether you qualify to extend your lease. In certain situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
It is generally accepted that a property with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years ahead.
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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 |
| 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 procure Knutsford 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.
Last Autumn Michael, came precariously near to the eighty-year mark with the lease on his two bedroom flat in Knutsford. Having purchased his home two decades ago, the unexpired term was of no interest. As luck would have it, he noticed he needed to take action soon on Extending the lease. Michael was able to extend his lease just under the wire in September. Michael and the freeholder via the managing agents ultimately settled on sum of £5,500 . If he had missed the deadline, the figure would have become more exhorbitant by a minimum £950.
In 2010 we were contacted by Mr E Rogers who, having purchased a studio apartment in Knutsford in April 1997. The question was if we could approximate the compensation to the landlord could be to extend the lease by an additional years. Comparable flats in Knutsford with an extended lease were valued around £265,000. The average ground rent payable was £50 billed every twelve months. The lease came to a finish in 2098. Given that there were 73 years outstanding we estimated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 exclusive of costs.
In 2013 we were called by Mr J López who, having completed a ground floor flat in Knutsford in May 2002. We are asked if we could approximate the premium would be to prolong the lease by 90 years. Similar properties in Knutsford with a long lease were in the region of £264,000. The average ground rent payable was £60 collected per annum. The lease finished in 2078. Taking into account 53 years as a residual term we calculated the compensation to the landlord to extend the lease to be within £37,100 and £42,800 exclusive of fees.