It’s a harsh certainty that a Salford residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the Salford property market.Once your lease nears 85ish years, you should start considering a lease extension. If the number of years remaining falls under eighty years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of leasehold owners in Salford will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you qualify for an extension. In some cases you may not qualify. There are also strict timeframes and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancer from beginning to end of the formalities.
It is conventional wisdom that a residential leasehold with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to any lease with more than 45 years remaining, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Salford can be a difficult process. We recommend you obtain guidance from a conveyancing solicitor and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Salford lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Off the back of unsuccessful negotiations with the freeholder of her ground floor flat in Salford, Eleanor commenced the lease extension process just as the lease was nearing the crucial 80-year deadline. The legal work was concluded in April 2007. The freeholder’s costs were negotiated to under 700 GBP.
Dr Morgan Brooks purchased a basement apartment in Salford in September 1999. The dilemma was if we could shed any light on how much (roughly) premium would likely be for a ninety year lease extension. Identical residencies in Salford with an extended lease were in the region of £225,400. The mid-range ground rent payable was £45 billed quarterly. The lease ended on 14 November 2090. Taking into account 64 years left we calculated the premium to the landlord for the lease extension to be within £16,200 and £18,600 plus expenses.
In 2014 we were called by Dr R Smith who, having acquired a basement apartment in Salford in August 2005. We are asked if we could approximate the price could be to prolong the lease by ninety years. Similar premises in Salford with a long lease were worth £270,000. The mid-range amount of ground rent was £55 billed monthly. The lease concluded on 11 September 2101. Taking into account 75 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 plus expenses.