Unfortunately that a Norris Green residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the reduction being disguised by increases in the Norris Green property market.Once your lease gets to 85ish years, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls lower than eighty years - otherwise a higher amount will be payable. Most leasehold owners in Norris Green will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify whether you are eligibility. In some cases you may not qualify. There are also strict timeframes and procedures to follow once the process is initiated and you will need to be guided by your conveyancer throughout the formalities.
Leasehold properties in Norris Green with over one hundred years left on the lease are often regarded as a ‘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 to be gained by buying the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Retaining our service gives you better control over the value of your Norris Green leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Finley was the the leasehold proprietor of a 2 bedroom apartment in Norris Green being sold with a lease of a little over fifty eight years unexpired. Finley informally contacted his landlord being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent to start with set at £100 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Finley to invoke his statutory right. Finley obtained expert legal guidance and secured satisfactory resolution informally and ending up with a market value flat.
Last year we were contacted by Ms Melissa Turner , who moved into a one bedroom apartment in Norris Green in November 2005. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be for a 90 year lease extension. Similar properties in Norris Green with a long lease were worth £208,600. The average amount of ground rent was £60 billed quarterly. The lease concluded in 2083. Given that there were 57 years outstanding we calculated the premium to the freeholder to extend the lease to be within £30,400 and £35,200 exclusive of fees.
In 2010 we were contacted by Mrs U Evans who, having owned a ground floor flat in Norris Green in May 2005. We are asked if we could approximate the compensation to the landlord would be for a 90 year extension to my lease. Identical residencies in Norris Green with a long lease were in the region of £200,000. The mid-range amount of ground rent was £50 collected yearly. The lease concluded in 2103. Given that there were 77 years unexpired we calculated the premium to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of fees.