The value of Poynton leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can increase significantly once the remaining term is less than eighty years
Leasehold residencies in Poynton with more than 100 years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in buying the freehold unless savings on ground rent and maintenance 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| 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 Poynton 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 conveyancer we work with provide it.
In the wake of 9 months of lengthy discussions with the landlord of her leasehold flat in Poynton, Samantha started the lease extension process as the eighty year threshold was quickly coming. The legal work completed in July 2015. The freeholder’s costs were kept to an absolute minimum.
In 2010 we were e-mailed by Mr and Mrs. M Vincent who, having bought a first floor flat in Poynton in January 2009. We are asked if we could approximate the price would likely be for a ninety year extension to my lease. Similar properties in Poynton with a long lease were worth £250,000. The average ground rent payable was £50 collected every twelve months. The lease terminated in 2095. Having 69 years remaining we calculated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 exclusive of professional charges.
Mrs Zoe Simon acquired a newly refurbished flat in Poynton in February 1998. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be for a 90 year lease extension. Comparable flats in Poynton with a long lease were in the region of £285,000. The average amount of ground rent was £55 collected yearly. The lease concluded in 2106. Having 80 years left we calculated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 plus costs.