When it comes to domestic leasehold premises in Carlisle, you are in fact renting it for a certain amount of time. In recent years flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you may think about extending the lease sooner rather than later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly especially once there are less than 80 years left. Leasehold owners in Carlisle with a lease nearing 81 years left should seriously consider extending it sooner than later. Once a lease has fewer than 80 years outstanding, under the relevant Act the freeholder is entitled to calculate and levy a greater amount, based on a technical computation, known as “marriage value” which is payable.
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be worth the same as 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with undertake Carlisle lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancer we work with provide it.
Two years ago Omar, came critically near to the eighty-year threshold with the lease on his purpose- built flat in Carlisle. Having bought his home two decades ago, the lease term was of no relevance. Luckily, he noticed he would imminently be paying an escalated premium for a lease extension. Omar arranged for a lease extension just ahead of time in July. Omar and the freeholder eventually agreed on sum of £5,000 . If the lease had gone to less than 80 years, the price would have gone up by a minimum £1,100.
Ms Katherine Lee acquired a recently refurbished flat in Carlisle in July 2008. We are asked if we could estimate the compensation to the landlord would be for a 90 year extension to my lease. Comparable flats in Carlisle with an extended lease were valued about £201,200. The average ground rent payable was £55 collected annually. The lease finished in 2081. Taking into account 56 years unexpired we estimated the premium to the freeholder for the lease extension to be within £31,400 and £36,200 plus expenses.
In 2009 we were e-mailed by Mrs Louise Stewart who, having took over the lease of a basement apartment in Carlisle in July 2004. The question was if we could shed any light on how much (roughly) price would be to extend the lease by an additional years. Comparative premises in Carlisle with 100 year plus lease were worth £300,000. The average ground rent payable was £50 billed every twelve months. The lease came to a finish in 2101. Considering the 76 years unexpired we estimated the premium to the landlord to extend the lease to be between £8,600 and £9,800 plus fees.