The market value of a leasehold property in Carlisle is impacted by how many years the lease has remaining. If it is close to or fewer than eighty years you should envisage problems on re-sale, so it is recommended to arrange for the lease to be extended prior to buying. It is preferable to start the process of extending the lease is when the lease still has 82 years to run so that a lease extension can be concluded prior to the eighty year threshold. Leasehold Reform legislation entitles Carlisle qualifying lessees to acquire a lease extension of ninety years in addition to the remaining length of the lease at a peppercorn rent (that is, rent free). The intention of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is generally considered that a residential leasehold with more than one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 30 years left, the property will be worth the same as a freehold for many years ahead.
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; |
Halifax | Minimum 70 years from the date of the mortgage. |
Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
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 freeholder in Carlisle,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Carlisle valuers.
Elijah owned a high value flat in Carlisle being marketed with a lease of a few days over fifty eight years left. Elijah on an informal basis spoke with his landlord being a well known local-based freehold company and enquired on a premium to extend the lease. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £125 annually. No ground rent would be payable on a lease extension were Elijah to invoke his statutory right. Elijah procured expert advice and secured satisfactory deal informally and readily saleable.
Mr and Mrs. A Mason acquired a ground floor apartment in Carlisle in October 2008. The dilemma was if we could estimate the price would be for a 90 year lease extension. Comparable properties in Carlisle with 100 year plus lease were valued around £285,000. The average amount of ground rent was £45 billed yearly. The lease finished in 2096. Having 71 years remaining we approximated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 plus professional charges.
Dr W Díaz moved into a one bedroom apartment in Carlisle in February 2000. We are asked if we could approximate the premium would be for a 90 year extension to my lease. Comparable properties in Carlisle with a long lease were valued about £225,800. The mid-range amount of ground rent was £60 billed annually. The lease lapsed on 14 October 2085. Having 60 years outstanding we approximated the premium to the landlord for the lease extension to be between £23,800 and £27,400 plus costs.