The market value of Knutsford 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 substantially once the remaining term is less than 80 years
Leasehold properties in Knutsford with more than 100 years outstanding 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 premises. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Retaining our service gives you better control over the value of your Knutsford leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Riley was the the leasehold proprietor of a high value apartment in Knutsford being sold with a lease of a little over 72 years remaining. Riley on an informal basis approached his freeholder being a well known Manchester-based freehold company for a lease extension. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £150 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Riley to exercise his statutory right. Riley procured expert advice and was able to make an informed decision and deal with the matter and sell the property.
Mr and Mrs. A Khan purchased a recently refurbished flat in Knutsford in July 2009. We are asked if we could shed any light on how much (roughly) price would likely be for a ninety year extension to my lease. Identical residencies in Knutsford with 100 year plus lease were valued around £275,000. The mid-range amount of ground rent was £55 collected annually. The lease elapsed in 2102. Having 76 years unexpired we calculated the compensation to the freeholder for the lease extension to be within £9,500 and £11,000 plus professional charges.
Last year we were called by Mr and Mrs. B González , who took over the lease of a one bedroom flat in Knutsford in November 2001. The dilemma was if we could estimate the price would be to extend the lease by a further 90 years. Identical flats in Knutsford with a long lease were valued around £176,200. The average amount of ground rent was £65 collected annually. The lease ended on 13 February 2082. Taking into account 56 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £29,500 and £34,000 plus expenses.