Unfortunately that a Northwich residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Northwich property market.Where your lease has approximately 90 years left, you should 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 slips lower than eighty years - otherwise a higher amount will be due. Most leasehold owners in Northwich will be able to extend under the legislation; however a lawyer should be able to clarify if you are eligibility. In some cases you may not be entitled. There are also strict timetables and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer for the duration of the formalities.
Leasehold properties in Northwich with over one hundred years outstanding 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 home. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | 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. |
| 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. |
| 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 |
Engaging our service gives you better control over the value of your Northwich leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Isaac owned a high value apartment in Northwich being sold with a lease of just over 72 years remaining. Isaac on an informal basis spoke with his landlord being a well known local-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent to start with set at £200 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Isaac to exercise his statutory right. Isaac procured expert advice and was able to make an informed judgement and handle with the matter and ending up with a market value flat.
Last June we were contacted by Mr and Mrs. V Wright , who owned a basement flat in Northwich in March 2008. The question was if we could approximate the price could be to extend the lease by an additional years. Similar residencies in Northwich with a long lease were worth £248,000. The average amount of ground rent was £65 invoiced monthly. The lease ended on 8 August 2087. Taking into account 63 years remaining we approximated the compensation to the freeholder to extend the lease to be between £20,000 and £23,000 plus legals.
Dr R Rose was assigned a lease of a studio apartment in Northwich in August 1995. The dilemma was if we could estimate the price could be for a ninety year lease extension. Comparable homes in Northwich with an extended lease were valued around £181,600. The mid-range ground rent payable was £55 billed every twelve months. The lease concluded on 1 March 2076. Given that there were 52 years left we approximated the compensation to the landlord to extend the lease to be between £30,400 and £35,200 not including professional charges.