Leigh residential property owned on a long lease is a depreciating asset as the leaseholder only owns the property for a period of years.
Leasehold properties in Leigh with in excess of one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges justify it.
| 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with handle 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 conveyancer we work with provide it.
In recent months Jacob, came seriously near to the 80-year threshold with the lease on his leasehold flat in Leigh. In buying his property twenty years previously, the length of the lease was of minimal relevance. Thankfully, it dawned on him that he needed to take steps soon on Extending the lease. Jacob was able to extend his lease just under the wire in January. Jacob and the landlord who owned the flat above ultimately agreed on sum of £5,500 . If he had missed the deadline, the premium would have increased by at least £1,000.
Dr S Moreau completed a garden flat in Leigh in August 2006. The dilemma was if we could approximate the compensation to the landlord would be to prolong the lease by an additional years. Comparable premises in Leigh with 100 year plus lease were in the region of £267,600. The average ground rent payable was £65 collected annually. The lease ended in 2093. Taking into account 67 years as a residual term we estimated the compensation to the landlord for the lease extension to be within £14,300 and £16,400 plus legals.
In 2011 we were phoned by Mr Nathaniel Young who, having was assigned a lease of a basement apartment in Leigh in April 2009. The question was if we could shed any light on how much (approximately) price could be to extend the lease by a further 90 years. Identical flats in Leigh with 100 year plus lease were in the region of £206,200. The mid-range ground rent payable was £55 invoiced monthly. The lease ran out in 2082. Having 56 years left we estimated the compensation to the freeholder for the lease extension to be within £31,400 and £36,200 exclusive of expenses.