Rochdale leases on residential properties are gradually losing value. Where your lease has approximately 90 years remaining, you should start thinking about a lease extension. If lease term is under 80 years, you will then be required to pay half of the property's 'marriage value' on top of the standard cost of the lease extension to your landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Flat owners in Rochdale will mostly be legally entitled to a lease extension; however a solicitor will check your eligibility. In certain situations you may not be entitled. There are also strict timetables and procedures to comply with once the process has commenced so it’s prudent to be guided by a conveyancing solicitor during the process.
It is conventional wisdom that a residential leasehold with over one hundred years remaining is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
| 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 |
Retaining our service will provide you enhanced control over the value of your Rochdale leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Half a year ago Eli, started to get close to the eighty-year mark with the lease on his basement flat in Rochdale. In buying his home two decades ago, the lease term was of minimal concern. by good luck, he became aware that he needed to take action soon on a lease extension. Eli arranged for a lease extension at the eleventh hour last March. Eli and the freeholder eventually agreed on the final figure of £5,500 . If the lease had fallen below 80 years, the amount would have gone up by at least £900.
In 2010 we were called by Dr H James who, having acquired a first floor apartment in Rochdale in November 1995. We are asked if we could approximate the price would be for a ninety year lease extension. Similar homes in Rochdale with an extended lease were valued about £300,000. The mid-range amount of ground rent was £50 invoiced yearly. The lease expired on 24 May 2100. Having 76 years outstanding we calculated the premium to the landlord to extend the lease to be between £8,600 and £9,800 plus expenses.
Mr Lewis Cook purchased a ground floor flat in Rochdale in October 2008. We are asked if we could estimate the compensation to the landlord could be to prolong the lease by 90 years. Comparative residencies in Rochdale with an extended lease were in the region of £257,800. The average ground rent payable was £65 billed quarterly. The lease expired in 2089. Given that there were 65 years as a residual term we approximated the compensation to the landlord to extend the lease to be between £18,100 and £20,800 not including fees.