It’s an underpublicised truth that a Manchester residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the depreciation being disguised by increases in the Manchester property market.Once your lease gets to 85ish years, you should start considering a lease extension. If lease term dips below eighty years, you will then be required to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property Most flat owners in Manchester will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm whether you qualify for an extension. In some situations you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor for the duration of the process.
Leasehold residencies in Manchester with more than one hundred years remaining 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 circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Engaging our service gives you increased control over the value of your Manchester leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Aiden was the the leasehold proprietor of a conversion flat in Manchester being sold with a lease of just over 61 years outstanding. Aiden on an informal basis spoke with his freeholder being a well known Manchester-based freehold company for a lease extension. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £100 annually. No ground rent would be due on a lease extension were Aiden to exercise his statutory right. Aiden obtained expert legal guidance and secured an acceptable deal without resorting to tribunal and sell the flat.
Mr and Mrs. L Simon took over the lease of a garden flat in Manchester in November 1997. The dilemma was if we could approximate the price would be to prolong the lease by a further 90 years. Identical premises in Manchester with an extended lease were valued around £166,400. The average ground rent payable was £60 collected monthly. The lease came to a finish in 2079. Considering the 54 years left we approximated the premium to the freeholder for the lease extension to be between £32,300 and £37,400 plus expenses.
Dr V Murphy acquired a ground floor flat in Manchester in November 2004. The dilemma was if we could shed any light on how much (approximately) premium would likely be for a ninety year extension to my lease. Identical homes in Manchester with an extended lease were in the region of £227,800. The mid-range ground rent payable was £45 billed monthly. The lease expiry date was in 2090. Having 65 years outstanding we estimated the premium to the freeholder for the lease extension to be within £13,300 and £15,400 not including expenses.