Unfortunately that a Cambridge residential lease is a deteriorating asset. As the lease term reduces 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 Cambridge property market.Once your lease gets to 85ish years, you need to start considering a lease extension. If the number of years remaining dips under eighty years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property Most leasehold owners in Cambridge will be able to extend under the legislation; however a conveyancer will be able to clarify whether you qualify for an extension. In some situations you may not be entitled. There are also strict timeframes and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor for the duration of the process.
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 45 years unexpired, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a landlord in Cambridge,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Cambridge valuers.
18 months ago Tyler, started to get close to the eighty-year mark with the lease on his purpose- built flat in Cambridge. Having purchased his flat two decades ago, the lease term was of little interest. Fortunately, he became aware that he needed to take action soon on Extending the lease. Tyler was able to extend his lease just ahead of time last April. Tyler and the freeholder via the management company ultimately agreed on sum of £5,000 . If the lease had slid below eighty years, the price would have increased by a minimum £1,100.
Last Spring we were approach by Dr N Cooper , who acquired a newly refurbished apartment in Cambridge in November 2006. We are asked if we could approximate the price would likely be for a ninety year lease extension. Identical homes in Cambridge with a long lease were in the region of £256,600. The average amount of ground rent was £60 billed quarterly. The lease came to a finish in 2077. Considering the 52 years remaining we calculated the compensation to the freeholder to extend the lease to be between £41,800 and £48,400 not including expenses.
Last Winter we were phoned by Dr T Hernández , who bought a one bedroom apartment in Cambridge in July 2006. We are asked if we could shed any light on how much (roughly) price could be to prolong the lease by a further 90 years. Comparative residencies in Cambridge with a long lease were valued around £218,000. The mid-range amount of ground rent was £45 invoiced quarterly. The lease elapsed on 11 July 2088. Given that there were 63 years as a residual term we calculated the premium to the landlord to extend the lease to be between £17,100 and £19,800 exclusive of costs.