The market value of a leasehold property in Little Mill depends on how long the lease has remaining. If it is near to or fewer than 80 years you should envisage difficulties on re-sale, so it is advisable to arrange for a lease extension before buying. It is ideal to start the process of extending the lease is when a lease still has 82 years remaining so that a lease extension can be addressed ahead of the eighty year mark. Statute enables Little Mill qualifying lessees to an additional term of ninety years in addition to the remaining term, at a notional rent (no ground rent). The intention of the valuation is to determine the sum payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold properties in Little Mill with over 100 years left 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 property. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Chelsea 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a landlord in Little Mill,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Little Mill valuers.
Lewis was the the leasehold proprietor of a conversion apartment in Little Mill being sold with a lease of a little over 61 years remaining. Lewis on an informal basis spoke with his freeholder a well known Manchester-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a rise in the rent to £125 yearly. No ground rent would be payable on a lease extension were Lewis to exercise his statutory right. Lewis obtained expert legal guidance and was able to make an informed decision and deal with the matter and readily saleable.
In 2010 we were contacted by Mr George Rose who, having was assigned a lease of a purpose-built flat in Little Mill in September 1999. The question was if we could shed any light on how much (roughly) premium would be for a 90 year lease extension. Identical homes in Little Mill with 100 year plus lease were valued about £223,400. The mid-range ground rent payable was £60 billed monthly. The lease concluded in 2085. Given that there were 59 years unexpired we approximated the compensation to the landlord for the lease extension to be within £27,600 and £31,800 plus legals.
In 2011 we were contacted by Mr and Mrs. F Green who, having took over the lease of a recently refurbished apartment in Little Mill in August 1999. We are asked if we could approximate the price would likely be to prolong the lease by ninety years. Comparative properties in Little Mill with a long lease were worth £205,000. The mid-range amount of ground rent was £50 billed monthly. The lease came to a finish in 2105. Taking into account 79 years remaining we approximated the compensation to the landlord for the lease extension to be within £8,600 and £9,800 not including expenses.