Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will ordinarily be granted for a set period of time , usually 99 or 125 years, although we have come across longer and shorter terms in Bardsley. Clearly, the length of lease remaining reduces as time goes by. This is often overlooked and only becomes a problem when the property has to be disposed of or refinanced. The fewer the years remaining the less it is worth and the more expensive it will be to obtain a lease extension. Eligible long lease owners in Bardsley have the right to extend the lease for a further 90 years in accordance with the 1993 Leasehold Reform Act. Please give careful attention before putting off your Bardsley lease extension. Holding off that expense now only increases the price you will eventually have to pay for a lease extension
It is generally accepted that a property with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 45 years remaining, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with undertake Bardsley 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 conveyancing solicitor we work with provide it.
Arthur owned a high value apartment in Bardsley on the market with a lease of fraction over fifty eight years unexpired. Arthur informally spoke with his landlord being a well known Manchester-based freehold company for a lease extension. The landlord indicated a willingness to extend 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 payable on a lease extension were Arthur to exercise his statutory right. Arthur procured expert advice and was able to make a more informed decision and handle with the matter and sell the property.
Last month we were phoned by Mr and Mrs. O Patel , who moved into a recently refurbished flat in Bardsley in April 2006. We are asked if we could estimate the premium would be for a ninety year extension to my lease. Similar homes in Bardsley with an extended lease were in the region of £174,200. The mid-range ground rent payable was £55 collected per annum. The lease elapsed in 2077. Given that there were 51 years left we estimated the compensation to the freeholder to extend the lease to be within £31,400 and £36,200 not including expenses.
In 2012 we were e-mailed by Ms A Lewis who, having moved into a purpose-built flat in Bardsley in October 2010. We are asked if we could approximate the premium would likely be for a 90 year extension to my lease. Similar homes in Bardsley with an extended lease were valued around £285,000. The mid-range ground rent payable was £45 collected per annum. The lease expired in 2097. Given that there were 71 years as a residual term we calculated the premium to the landlord to extend the lease to be within £12,400 and £14,200 not including costs.