Maghull leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease gets more expensive. Legislation has been in place for sometime now which entitles qualifying Maghull residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Maghull you must check if your lease has between seventy and ninety years left. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
Leasehold residencies in Maghull with more than one hundred years left on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
Regardless of whether you are a tenant or a landlord in Maghull,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Maghull valuers.
Michael owned a studio apartment in Maghull on the market with a lease of a little over 59 years remaining. Michael on an informal basis approached his freeholder being a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a new rent to start with set at £200 per annum and increase every 25 years thereafter. No ground rent would be payable on a lease extension were Michael to exercise his statutory right. Michael obtained expert advice and secured an acceptable resolution informally and readily saleable.
Last month we were called by Mr O Richardson , who acquired a purpose-built flat in Maghull in March 2008. We are asked if we could estimate the compensation to the landlord would likely be to extend the lease by an additional years. Identical homes in Maghull with 100 year plus lease were valued about £176,200. The average ground rent payable was £65 collected quarterly. The lease elapsed on 14 March 2082. Having 56 years unexpired we approximated the premium to the freeholder for the lease extension to be between £29,500 and £34,000 exclusive of expenses.
In 2011 we were e-mailed by Mrs Morgan Wilson who, having acquired a recently refurbished apartment in Maghull in March 1998. The question was if we could estimate the price would likely be to extend the lease by a further 90 years. Comparative flats in Maghull with an extended lease were valued about £237,600. The mid-range amount of ground rent was £45 collected per annum. The lease expiry date was on 8 June 2093. Having 67 years as a residual term we calculated the compensation to the landlord to extend the lease to be between £11,400 and £13,200 not including professional charges.