Melling leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease gets more expensive. Most owners of residential leasehold property in Melling enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Melling you must investigate if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under eighty years, the amount payable for any lease extension increases dramatically as an element of the premium you pay is what is known as a marriage value
Leasehold properties in Melling with more than 100 years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service will provide you enhanced control over the value of your Melling leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of lengthy negotiations with the landlord of her basement flat in Melling, Zoe initiated the lease extension process just as the lease was nearing the critical 80-year threshold. The lease extension completed in June 2014. The landlord’s fees were negotiated to a tad over 450 pounds.
In 2011 we were called by Dr W Bailey who, having took over the lease of a newly refurbished apartment in Melling in March 2008. The question was if we could shed any light on how much (roughly) compensation to the landlord could be for a ninety year extension to my lease. Comparable premises in Melling with 100 year plus lease were valued around £265,000. The mid-range ground rent payable was £50 collected yearly. The lease came to a finish on 17 February 2100. Having 74 years outstanding we calculated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 not including legals.
Last year we were e-mailed by Mr and Mrs. C James , who owned a purpose-built apartment in Melling in March 2009. We are asked if we could shed any light on how much (approximately) compensation to the landlord could be to prolong the lease by a further 90 years. Identical premises in Melling with 100 year plus lease were worth £264,000. The mid-range amount of ground rent was £60 collected monthly. The lease came to a finish in 2079. Considering the 53 years remaining we calculated the premium to the landlord for the lease extension to be between £37,100 and £42,800 plus fees.