Cheltenham leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. Most owners of residential leasehold property in Cheltenham enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Cheltenham you must investigate if your lease has between 70 and 90 years remaining. In particular once the remaining lease term slips under eighty years, the compensation to the landlord for any lease extension increases dramatically as an element of the premium you pay is what is known as a marriage value
Leasehold premises in Cheltenham with in excess of one hundred years left 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 situations there is often little upside in purchasing the freehold unless savings on ground rent and estate charges merit it.
| 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. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
Lease extensions in Cheltenham can be a difficult process. We recommend you get professional help from a conveyancing solicitor and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Cheltenham lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Following protracted negotiations with the landlord of her purpose-built flat in Cheltenham, Yasmin started the lease extension process just as the lease was approaching the critical 80-year threshold. The transaction completed in March 2005. The landlord’s costs were negotiated to less than 700 pounds.
In 2011 we were called by Ms D Brown who, having took over the lease of a studio flat in Cheltenham in March 2012. We are asked if we could shed any light on how much (roughly) price would be to prolong the lease by an additional years. Comparable premises in Cheltenham with a long lease were in the region of £264,000. The average amount of ground rent was £60 invoiced quarterly. The lease finished in 2079. Having 53 years as a residual term we calculated the premium to the landlord to extend the lease to be within £37,100 and £42,800 plus legals.
Dr Olivia Moreau bought a basement flat in Cheltenham in July 1998. We are asked if we could estimate the premium would be for a ninety year extension to my lease. Similar premises in Cheltenham with 100 year plus lease were in the region of £225,400. The mid-range ground rent payable was £45 invoiced quarterly. The lease finished in 2090. Having 64 years unexpired we estimated the compensation to the freeholder for the lease extension to be between £15,200 and £17,600 not including legals.