Lymm 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 gets more expensive. Legislation has been in place for sometime now allowing qualifying Lymm residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Lymm you would be well advised to investigate if your lease has between 70 and ninety years remaining. There are good reasons why a Lymm flat owner with a lease having around eighty years remaining should take action to ensure that a lease extension is put in place without delay
Leasehold premises in Lymm with over one hundred years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges merit it.
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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 |
| 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. |
Using our service will provide you enhanced control over the value of your Lymm leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Jasper owned a high value flat in Lymm being sold with a lease of just over sixty years left. Jasper informally approached his landlord a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £100 yearly. No ground rent would be payable on a lease extension were Jasper to exercise his statutory right. Jasper procured expert legal guidance and secured satisfactory deal without resorting to tribunal and readily saleable.
Last year we were phoned by Mr and Mrs. G Ramírez , who was assigned a lease of a one bedroom flat in Lymm in November 2005. The question was if we could approximate the premium could be to prolong the lease by ninety years. Comparable homes in Lymm with an extended lease were valued about £232,800. The average ground rent payable was £45 invoiced annually. The lease concluded on 2 July 2090. Considering the 65 years outstanding we calculated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 plus costs.
In 2009 we were phoned by Dr D Rodríguez who, having moved into a basement apartment in Lymm in January 2007. We are asked if we could approximate the price could be to prolong the lease by 90 years. Similar premises in Lymm with an extended lease were worth £275,000. The average ground rent payable was £55 billed annually. The lease elapsed in 2101. Considering the 76 years left we calculated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 not including expenses.