Ramsbottom 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 the lease becomes more expensive. Most owners of residential leasehold property in Ramsbottom enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Ramsbottom you must check if your lease has between 70 and ninety years left. There are compelling reasons why a Ramsbottom leaseholder with a lease having around 80 years unexpired should take action to make sure that a lease extension is put in place without delay
Leasehold premises in Ramsbottom with over 100 years left on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth 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 |
|---|---|
| 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. |
| Lloyds TSB Scotland | 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 |
The conveyancing solicitors that we work with procure Ramsbottom lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Thomas was the the leasehold owner of a 2 bedroom apartment in Ramsbottom being marketed with a lease of just over sixty years outstanding. Thomas on an informal basis spoke with his landlord a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of an increased rent to £50 yearly. No ground rent would be payable on a lease extension were Thomas to invoke his statutory right. Thomas procured expert advice and was able to make an informed judgement and deal with the matter and ending up with a market value flat.
Last year we were approach by Mr and Mrs. E Walker , who moved into a ground floor flat in Ramsbottom in April 2002. The question was if we could approximate the premium would likely be to prolong the lease by ninety years. Similar premises in Ramsbottom with 100 year plus lease were in the region of £198,800. The average amount of ground rent was £55 billed monthly. The lease terminated on 26 January 2079. Given that there were 55 years left we approximated the compensation to the landlord for the lease extension to be within £33,300 and £38,400 plus fees.
Last Christmas we were phoned by Mr and Mrs. L Williams , who took over the lease of a first floor apartment in Ramsbottom in April 2006. We are asked if we could shed any light on how much (roughly) price would likely be for a ninety year extension to my lease. Comparable homes in Ramsbottom with 100 year plus lease were valued about £295,000. The mid-range amount of ground rent was £50 collected annually. The lease expired in 2099. Taking into account 75 years as a residual term we calculated the premium to the landlord to extend the lease to be within £8,600 and £9,800 not including expenses.