Unfortunately that a Newton Heath residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the reduction being disguised by increases in the Newton Heath property prices.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. If lease term drops under 80 years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property The majority of flat owners in Newton Heath will be able to extend under the legislation; however a lawyer should be able to clarify whether you are eligibility. In some cases you may not qualify. There are also strict deadlines and procedures to follow once the process is instigated and you will need to be guided by your conveyancing solicitor from beginning to end of the process.
It is generally considered that a residential leasehold with in excess of 100 years unexpired lease term is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 35 years left, the property will be equivalent in value to a freehold for many years ahead.
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a landlord in Newton Heath,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Newton Heath valuers.
Off the back of lengthy negotiations with the landlord of her one bedroom flat in Newton Heath, Kayleigh initiated the lease extension process as the 80 year threshold was quickly nearing. The transaction was concluded in February 2005. The landlord’s fees were kept to an absolute minimum.
In 2009 we were phoned by Mrs A Miller who, having took over the lease of a recently refurbished apartment in Newton Heath in April 2007. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be to extend the lease by 90 years. Comparative homes in Newton Heath with 100 year plus lease were worth £181,600. The average ground rent payable was £55 collected monthly. The lease finished in 2078. Having 52 years as a residual term we calculated the compensation to the landlord for the lease extension to be between £30,400 and £35,200 not including costs.
In 2013 we were e-mailed by Dr P Michel who, having bought a basement apartment in Newton Heath in March 2002. The question was if we could estimate the compensation to the landlord would likely be to prolong the lease by 90 years. Similar flats in Newton Heath with a long lease were in the region of £290,000. The mid-range amount of ground rent was £45 billed quarterly. The lease lapsed on 12 June 2098. Given that there were 72 years left we approximated the premium to the freeholder to extend the lease to be between £11,400 and £13,200 not including professional charges.