Cheetham Hill leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. Legislation has been in place for sometime now which permits qualifying Cheetham Hill residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Cheetham Hill you should see if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under eighty 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
Leasehold properties in Cheetham Hill 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 situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Halifax | 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a freeholder in Cheetham Hill,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Cheetham Hill valuers.
Liam owned a studio apartment in Cheetham Hill on the market with a lease of fraction over 72 years outstanding. Liam informally spoke with his landlord a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent at the outset set at £150 per annum and increase every twenty five years thereafter. No ground rent would be payable on a lease extension were Liam to invoke his statutory right. Liam procured expert advice and secured an acceptable resolution informally and ending up with a market value flat.
In 2014 we were contacted by Ms Sarah Ricardo who, having completed a first floor flat in Cheetham Hill in January 2010. The question was if we could approximate the price could be to extend the lease by 90 years. Identical residencies in Cheetham Hill with 100 year plus lease were worth £270,000. The mid-range ground rent payable was £55 invoiced yearly. The lease elapsed on 21 November 2101. Considering the 75 years remaining we calculated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 not including costs.
Dr Jacob Garcia owned a one bedroom apartment in Cheetham Hill in August 2002. The dilemma was if we could approximate the price would likely be to extend the lease by a further 90 years. Comparative properties in Cheetham Hill with a long lease were valued about £173,800. The average amount of ground rent was £60 billed yearly. The lease lapsed in 2081. Given that there were 55 years unexpired we approximated the premium to the landlord to extend the lease to be within £31,400 and £36,200 plus fees.