Preston leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. The majority of owners of residential leasehold property in Preston enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Preston you really ought to see if your lease has between seventy and ninety years left. There are compelling reasons why a Preston leaseholder with a lease having around eighty years remaining should take action to make sure that a lease extension is effected without delay
Leasehold premises in Preston with in excess of 100 years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service will provide you increased control over the value of your Preston leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Arthur was the the leasehold proprietor of a high value flat in Preston on the market with a lease of a few days over 61 years left. Arthur on an informal basis contacted his freeholder being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent at the outset set at £150 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Arthur to invoke his statutory right. Arthur obtained expert legal guidance and secured an acceptable deal without resorting to tribunal and sell the flat.
In 2010 we were approached by Mr and Mrs. Y Reed who, having owned a basement apartment in Preston in November 2007. The question was if we could estimate the compensation to the landlord would be to extend the lease by 90 years. Comparative homes in Preston with 100 year plus lease were worth £260,000. The average ground rent payable was £50 collected annually. The lease elapsed in 2099. Given that there were 73 years unexpired we approximated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 exclusive of expenses.
An example of a Lease Extension decision for a Preston flat is Ground Floor Flat 79 London Road in September 2012. the Tribunal held that the premium payable for the lease extension should be £7,636 This case affected 1 flat. The remaining number of years on the lease was 74 years.