The re-sale value of a leasehold property in Carlisle is impacted by how long the lease has remaining. If it is close to or less than 80 years you should anticipate problems on re-sale, so it is advisable to arrange for the lease to be extended prior to purchasing. 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 addressed ahead of the eighty year threshold. Current legislation enables Carlisle qualifying lessees to a 90 year extension added to their unexpired lease term (ie if your lease has 50 years left the statutory lease extension will provide a new term of 140 years). The purpose of the valuation is to determine the sum payable by the lessee to the freeholder for the purchase of the lease extension.
It is generally considered that a property with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 30 years unexpired, 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. |
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| 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. |
Lease extensions in Carlisle can be a difficult process. We recommend you secure professional help from a lawyer and surveyor with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Carlisle lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Finn owned a 2 bedroom apartment in Carlisle being sold with a lease of just over 61 years unexpired. Finn on an informal basis spoke with his freeholder being a well known Bristol-based freehold company for a lease extension. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent to start with set at £150 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Finn to invoke his statutory right. Finn procured expert advice and was able to make a more informed decision and deal with the matter and readily saleable.
In 2010 we were phoned by Mr and Mrs. C Vincent who, having completed a basement apartment in Carlisle in September 1996. The question was if we could shed any light on how much (roughly) compensation to the landlord could be to extend the lease by 90 years. Identical residencies in Carlisle with a long lease were in the region of £200,000. The mid-range ground rent payable was £50 invoiced every twelve months. The lease ended in 2103. Taking into account 77 years left we estimated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 plus costs.
In 2014 we were approached by Mr B Roberts who, having owned a purpose-built flat in Carlisle in September 2001. We are asked if we could approximate the compensation to the landlord would be to extend the lease by a further 90 years. Comparative homes in Carlisle with 100 year plus lease were in the region of £260,200. The average amount of ground rent was £65 invoiced per annum. The lease expiry date was in 2092. Having 66 years as a residual term we estimated the premium to the landlord to extend the lease to be between £16,200 and £18,600 exclusive of expenses.