Denton 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 the lease becomes more expensive. It is the case that most Denton tenants have the right to extend their lease by an additional ninety years under the 1993 Leasehold Reform Act. Where you are a leasehold owner in Denton you must see if your lease has between 70 and 90 years remaining. There are compelling reasons why a Denton leaseholder with a lease having around eighty years unexpired should take steps to make sure that a lease extension is put in place without delay
It is conventional wisdom that a residential leasehold with over one hundred years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 30 years remaining, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| Coventry Building Society | 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. |
| Yorkshire 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. |
Regardless of whether you are a tenant or a freeholder in Denton,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 in-depth market knowledge and the close ties they enjoy with Denton valuers.
After unsuccessful negotiations with the freeholder of her one bedroom flat in Denton, Alisha initiated the lease extension process as the 80 year mark was quickly coming. The legal work completed in August 2008. The landlord’s charges were kept to an absolute minimum.
Last Autumn we were approach by Mr and Mrs. S Miller , who was assigned a lease of a purpose-built apartment in Denton in January 2005. We are asked if we could approximate the compensation to the landlord could be to prolong the lease by ninety years. Identical properties in Denton with 100 year plus lease were valued about £200,800. The mid-range ground rent payable was £65 invoiced annually. The lease came to a finish in 2085. Taking into account 60 years as a residual term we approximated the premium to the freeholder for the lease extension to be within £20,900 and £24,200 not including fees.
Mrs P Flores owned a ground floor flat in Denton in July 2000. The question was if we could estimate the compensation to the landlord would likely be for a ninety year lease extension. Similar premises in Denton with 100 year plus lease were valued around £255,000. The mid-range ground rent payable was £50 invoiced every twelve months. The lease finished on 26 July 2096. Given that there were 71 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 plus fees.