Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will normally be granted for a fixed period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Cudham. Inevitably, the length of lease remaining reduces as time goes by. This may slip by relatively unnoticed when the flat or house needs to be sold or refinanced. The fewer the years remaining the less it is worth and the more expensive it will be to procure a lease extension. Qualifying leaseholders in Cudham have the legal entitlement to extend the lease for an additional 90 years in accordance with the 1993 Leasehold Reform Act. Please give due attention before delaying your Cudham lease extension. Holding off the cost now only increases the price you will eventually incur for a lease extension
Leasehold residencies in Cudham with in excess of 100 years unexpired on the lease are often regarded as a ‘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 buying the freehold unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| 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. |
| Godiva Mortgages | 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. |
| 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. |
Regardless of whether you are a tenant or a freeholder in Cudham,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Cudham valuers.
Sebastian was the the leasehold owner of a high value apartment in Cudham on the market with a lease of fraction over fifty eight years left. Sebastian on an informal basis spoke with his landlord being a well known Bristol-based freehold company for a lease extension. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent initially set at £100 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Sebastian to invoke his statutory right. Sebastian obtained expert legal guidance and secured an acceptable deal informally and sell the property.
Last Winter we were approach by Mrs Louise Martinez , who took over the lease of a newly refurbished flat in Cudham in June 2006. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would be for a 90 year lease extension. Identical properties in Cudham with a long lease were in the region of £254,200. The average amount of ground rent was £60 collected monthly. The lease termination date was on 6 January 2076. Taking into account 51 years remaining we approximated the compensation to the landlord for the lease extension to be within £43,700 and £50,600 plus professional charges.
An example of a Lease Extension case for a Cudham premises is 1 Southlands Court Southlands Road in September 2013. The Leasehold Valuation Tribunal determined that the premium to be paid by the tenant on the grant of a new lease, in accordance with section 56 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 was £30,541 This case was in relation to 1 flat. The number of years remaining on the existing lease(s) was 50.57 years.