As the the remaining lease term of a Carlisle residential lease diminished so does its value and therefore the value of your property. Where the residual term has, over 99 years remaining then this decrease may be of little impact that being said there will become a point in time when a lease has less than eighty years remaining as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the primary rational as to why you should extend the lease sooner than later. The majority of flat owners in Carlisle will meet the qualifying criteria; nevertheless a conveyancer can advise whether you qualify to extend your lease. In limited situations you may not qualify, the most frequent reason being that you have owned the property for under two years.
Leasehold residencies in Carlisle with more than one hundred years outstanding on the lease are sometimes referred to as ‘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 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. |
| 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
Retaining our service gives you enhanced control over the value of your Carlisle leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Hugo owned a high value flat in Carlisle being marketed with a lease of just over 61 years remaining. Hugo on an informal basis approached his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a rise in the rent to £50 per annum. No ground rent would be due on a lease extension were Hugo to invoke his statutory right. Hugo obtained expert advice and was able to make an informed decision and handle with the matter and sell the property.
In 2014 we were phoned by Mrs K Martin who, having completed a garden flat in Carlisle in September 2010. The dilemma was if we could approximate the price could be for a 90 year extension to my lease. Similar homes in Carlisle with a long lease were valued about £200,000. The average ground rent payable was £50 invoiced monthly. The lease terminated in 2103. Taking into account 78 years unexpired we calculated the compensation to the landlord for the lease extension to be within £8,600 and £9,800 plus professional charges.
Mr and Mrs. F Hall moved into a newly refurbished flat in Carlisle in May 2004. The question was if we could estimate the premium would likely be to prolong the lease by an additional years. Similar flats in Carlisle with 100 year plus lease were worth £267,600. The mid-range ground rent payable was £65 collected every twelve months. The lease end date was in 2092. Considering the 67 years outstanding we approximated the compensation to the freeholder to extend the lease to be within £14,300 and £16,400 plus professional charges.