Alderley Edge residential property owned on a long lease is a depreciating asset as the leaseholder merely owns the property for a set term.
It is generally considered that a property with more than 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 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
Retaining our service gives you better control over the value of your Alderley Edge leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
18 months ago Andrew, came seriously near to the eighty-year threshold with the lease on his garden flat in Alderley Edge. In buying his flat 19 years previously, the lease term was of minimal significance. As luck would have it, it dawned on him that he needed to take steps soon on Extending the lease. Andrew extended the lease at the eleventh hour in March. Andrew and the landlord who owned the flat above eventually agreed on an amount of £5,500 . If the lease had dipped lower than eighty years, the amount would have gone up by a minimum £1,000.
Last July we were approach by Mr and Mrs. J González , who moved into a studio flat in Alderley Edge in October 2007. We are asked if we could estimate the price would be to extend the lease by 90 years. Identical flats in Alderley Edge with a long lease were valued about £264,000. The average amount of ground rent was £60 billed every twelve months. The lease concluded in 2078. Having 53 years left we estimated the compensation to the landlord to extend the lease to be between £37,100 and £42,800 exclusive of legals.
In 2014 we were e-mailed by Mr Riley Miller who, having moved into a newly refurbished flat in Alderley Edge in August 2008. We are asked if we could estimate the premium would be to prolong the lease by 90 years. Identical residencies in Alderley Edge with an extended lease were valued about £225,400. The average amount of ground rent was £45 collected per annum. The lease concluded on 6 July 2089. Given that there were 64 years remaining we approximated the premium to the freeholder for the lease extension to be between £16,200 and £18,600 plus professional charges.