When it comes to domestic leasehold premises in Openshaw, you effectively rent it for a certain period of time. These days flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you may think about a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly especially once there are less than 80 years left. Anyone in Openshaw with a lease nearing 81 years unexpired should seriously think of extending it sooner as opposed to later. Once the lease term has under 80 years left, under the relevant statute the freeholder can calculate and demand a greater premium, based on a technical computation, strangely termed as “marriage value” which is payable.
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years in the future.
| 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| Yorkshire 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. |
The conveyancing solicitors that we work with handle Openshaw lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancing solicitor we work with provide it.
Two years ago Jason, came very near to the 80-year mark with the lease on his first floor apartment in Openshaw. In buying his home twenty years previously, the length of the lease was of little significance. As luck would have it, it dawned on him that he needed to take action soon on a lease extension. Jason was able to extend his lease just in the nick of time last January. Jason and the landlord who owned the flat above eventually agreed on the final figure of £5,000 . If he not met the deadline, the premium would have increased by at least £900.
Last Spring we were e-mailed by Mrs Shannon Jackson , who moved into a first floor flat in Openshaw in May 2009. The question was if we could shed any light on how much (approximately) premium would be to prolong the lease by 90 years. Identical homes in Openshaw with 100 year plus lease were valued about £200,000. The average ground rent payable was £50 billed yearly. The lease lapsed on 18 November 2102. Given that there were 77 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 exclusive of expenses.
Last Summer we were called by Ms Natalie Howard , who bought a purpose-built apartment in Openshaw in February 2000. We are asked if we could approximate the price would likely be for a 90 year lease extension. Comparative flats in Openshaw with an extended lease were in the region of £260,200. The average ground rent payable was £65 billed quarterly. The lease concluded on 3 June 2091. Taking into account 66 years outstanding we calculated the premium to the landlord for the lease extension to be within £15,200 and £17,600 not including expenses.