The market value of a leasehold property in Thorpe Hesley depends on how long the lease has remaining. If it is near to or less than 80 years you should anticipate difficulties on re-sale, so it is advisable to arrange for the lease to be extended prior to purchasing. It is preferable to start the lease extension process when the lease still has 82 years remaining so that all matters can be concluded ahead of the eighty year threshold. Current legislation entitles Thorpe Hesley qualifying lessees to obtain a lease extension of 90 years in addition to the remaining lease term at a peppercorn rent (that is, rent free). The purpose of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold premises in Thorpe Hesley with in excess of one hundred years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
The conveyancing solicitors that we work with procure Thorpe Hesley 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.
Finn owned a studio apartment in Thorpe Hesley on the market with a lease of a little over 59 years unexpired. Finn on an informal basis approached his landlord being a well known Manchester-based freehold company for a lease extension. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £100 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Finn to exercise his statutory right. Finn procured expert advice and was able to make an informed judgement and deal with the matter and readily saleable.
Last Christmas we were called by Mrs O Ricardo , who owned a recently refurbished flat in Thorpe Hesley in April 2009. The dilemma was if we could estimate the price would be to prolong the lease by ninety years. Identical properties in Thorpe Hesley with 100 year plus lease were worth £176,200. The mid-range ground rent payable was £65 invoiced per annum. The lease terminated on 22 October 2082. Considering the 56 years unexpired we approximated the premium to the landlord to extend the lease to be within £29,500 and £34,000 plus fees.
In 2010 we were approached by Mrs Madeleine Richardson who, having owned a garden flat in Thorpe Hesley in August 2009. We are asked if we could approximate the compensation to the landlord could be for a ninety year extension to my lease. Comparable residencies in Thorpe Hesley with 100 year plus lease were in the region of £242,600. The mid-range ground rent payable was £45 invoiced quarterly. The lease ended in 2093. Taking into account 67 years remaining we approximated the compensation to the landlord to extend the lease to be within £11,400 and £13,200 exclusive of professional charges.