With a domestic leasehold property in Leigh, you are actually purchasing an entitlement to live in a property for a prescribed time frame. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you should consider a lease extension sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease becomes disproportionately greater notably when there are fewer than eighty years remaining. Anyone in Leigh with a lease nearing 81 years unexpired should seriously consider extending it without delay. When the lease term has less than eighty years outstanding, under the relevant statute the landlord can calculate and levy a greater premium, based on a technical multiplication, known as “marriage value” which is payable.
It is generally considered that a residential leasehold with in excess of one hundred years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years unexpired, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with procure Leigh 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.
Evan owned a high value apartment in Leigh being marketed with a lease of just over 61 years unexpired. Evan on an informal basis contacted his freeholder a well known local-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years subject to an increased rent to £50 annually. Ordinarily, ground rent would not be due on a lease extension were Evan to invoke his statutory right. Evan obtained expert advice and secured satisfactory resolution without resorting to tribunal and readily saleable.
Mr and Mrs. Y Parker acquired a ground floor apartment in Leigh in March 2004. We are asked if we could approximate the premium would be to prolong the lease by an additional years. Identical flats in Leigh with a long lease were worth £295,000. The average ground rent payable was £45 billed per annum. The lease terminated in 2100. Having 74 years outstanding we calculated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 plus expenses.
Last Winter we were e-mailed by Mr and Mrs. D Bailey , who bought a basement flat in Leigh in May 1995. 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. Comparative premises in Leigh with 100 year plus lease were worth £243,000. The mid-range ground rent payable was £65 billed annually. The lease concluded on 12 June 2089. Given that there were 63 years unexpired we estimated the compensation to the freeholder for the lease extension to be between £20,000 and £23,000 exclusive of professional charges.