It’s a harsh certainty that a Stalybridge 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 loss of value being disguised by increases in the Stalybridge property market.Where your lease has approximately 90 years left, you need to 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 under eighty years - otherwise a higher premium will be payable. Most flat owners in Stalybridge will be able to extend under the legislation; however a conveyancer will be able to confirm if you are eligibility. In some cases you may not qualify. There are also strict timeframes and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor for the duration of the formalities.
It is conventional wisdom that a property with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
The conveyancing solicitors that we work with procure Stalybridge 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 lawyer we work with provide it.
Two years ago Mason, started to get near to the 80-year threshold with the lease on his garden flat in Stalybridge. In buying his home two decades ago, the lease term was of minimal importance. As luck would have it, he realised he needed to take steps soon on Extending the lease. Mason extended the lease at the eleventh hour last September. Mason and the freeholder via the management company ultimately agreed on sum of £6,000 . If the lease had slipped to less than 80 years, the amount would have gone up by at least £1,050.
In 2011 we were phoned by Dr T Lewis who, having acquired a studio flat in Stalybridge in May 1997. The dilemma was if we could approximate the price would be for a ninety year lease extension. Comparative properties in Stalybridge with an extended lease were in the region of £280,000. The average amount of ground rent was £55 billed per annum. The lease expiry date was on 17 March 2103. Taking into account 78 years left we estimated the premium to the landlord for the lease extension to be within £13,300 and £15,400 plus fees.
Ms V Miller moved into a ground floor flat in Stalybridge in July 2010. The question was if we could approximate the premium would likely be to prolong the lease by an additional years. Comparable properties in Stalybridge with an extended lease were valued around £186,000. The mid-range amount of ground rent was £65 invoiced yearly. The lease ended on 2 July 2083. Taking into account 58 years as a residual term we calculated the compensation to the landlord to extend the lease to be within £24,700 and £28,600 not including expenses.