The market value of Bollington leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can increase materialy once the remaining term is less than 80 years
Leasehold premises in Bollington with more than 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with undertake Bollington 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.
Owen owned a conversion apartment in Bollington being marketed with a lease of a few days over fifty eight years remaining. Owen informally approached his landlord being a well known local-based freehold company for a lease extension. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Owen to invoke his statutory right. Owen procured expert legal guidance and was able to make a more informed decision and deal with the matter and ending up with a market value flat.
In 2014 we were e-mailed by Ms P Rodríguez who, having moved into a purpose-built apartment in Bollington in March 1998. We are asked if we could approximate the premium would likely be for a 90 year lease extension. Identical premises in Bollington with an extended lease were worth £295,000. The mid-range amount of ground rent was £45 invoiced annually. The lease finished in 2099. Having 74 years as a residual term we calculated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 not including expenses.
In 2009 we were contacted by Mr and Mrs. V Bonnet who, having completed a first floor flat in Bollington in August 2002. The question was if we could shed any light on how much (roughly) premium would likely be to extend the lease by an additional years. Identical flats in Bollington with 100 year plus lease were in the region of £243,000. The mid-range ground rent payable was £65 collected monthly. The lease finished on 21 September 2088. Having 63 years left we approximated the premium to the landlord for the lease extension to be between £20,000 and £23,000 plus costs.