Bury leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. It is the case that most Bury tenants have the right to extend their lease by an additional ninety years in accordance with the 1993 Leasehold Reform Act. Where you are a leasehold owner in Bury you really ought to investigate if your lease has between seventy and ninety years remaining. In particular once the remaining lease term slips under 80 years, the amount payable for any lease extension sharply increases as part of the premium you will incur is what is known as a marriage value
It is generally accepted that a property with more than 100 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 many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
Lease extensions in Bury can be a difficult process. We recommend you procure guidance from a conveyancing solicitor and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Bury lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Half a year ago Omar, started to get near to the eighty-year mark with the lease on his leasehold apartment in Bury. In buying his home twenty years ago, the unexpired term was of minimal significance. Luckily, it dawned on him that he would soon be paying an escalated premium for a lease extension. Omar arranged for a lease extension just under the wire last August. Omar and the freeholder via the managing agents eventually agreed on the final figure of £5,500 . If he failed to meet the deadline, the amount would have increased by a minimum £950.
Last year we were contacted by Mr Eliot Rogers , who bought a one bedroom apartment in Bury in November 1995. We are asked if we could shed any light on how much (roughly) price could be to prolong the lease by ninety years. Comparable flats in Bury with an extended lease were valued about £191,400. The average ground rent payable was £55 collected monthly. The lease ended in 2079. Taking into account 54 years as a residual term we calculated the premium to the landlord for the lease extension to be between £34,200 and £39,600 plus legals.
Dr Lewis Wright purchased a one bedroom flat in Bury in March 2008. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be to extend the lease by a further 90 years. Similar homes in Bury with an extended lease were worth £290,000. The mid-range ground rent payable was £45 invoiced quarterly. The lease ran out in 2099. Taking into account 74 years as a residual term we approximated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 exclusive of legals.