It’s an underpublicised truth that a Saltney residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the depreciation being disguised by increases in the Saltney property market.Once your lease nears 85ish years, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips under eighty years - otherwise a higher premium will be due. Most flat owners in Saltney will be able to extend under the legislation; however a conveyancer should be able to clarify whether you are eligibility. In some cases you may not qualify. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your lawyer for the duration of the process.
Leasehold residencies in Saltney with over 100 years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in purchasing the freehold 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. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Engaging our service gives you enhanced control over the value of your Saltney 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.
Twenty four months ago Ali, started to get near to the 80-year threshold with the lease on his ground floor flat in Saltney. Having purchased his flat two decades ago, the lease term was of minimal interest. Luckily, it dawned on him that he needed to take steps soon on Extending the lease. Ali was able to extend his lease at the eleventh hour in May. Ali and the landlord in the end agreed on the final figure of £5,500 . If he failed to meet the deadline, the premium would have become more exhorbitant by a minimum £1,075.
Last Summer we were phoned by Mr and Mrs. T Alexander , who acquired a first floor apartment in Saltney in February 2008. We are asked if we could shed any light on how much (roughly) price could be to extend the lease by a further 90 years. Identical residencies in Saltney with an extended lease were worth £280,000. The average amount of ground rent was £45 invoiced monthly. The lease finished on 15 October 2096. Having 71 years remaining we calculated the compensation to the landlord to extend the lease to be between £12,400 and £14,200 exclusive of professional charges.
In 2011 we were contacted by Mrs Gemma Mitchell who, having completed a purpose-built flat in Saltney in January 2008. The question was if we could shed any light on how much (approximately) price would likely be for a 90 year extension to my lease. Identical flats in Saltney with 100 year plus lease were valued around £225,800. The mid-range amount of ground rent was £60 collected annually. The lease finished on 25 February 2085. Taking into account 60 years unexpired we estimated the premium to the freeholder to extend the lease to be between £25,700 and £29,600 plus costs.