The market value of a leasehold property in Carlisle depends on how many years the lease has left to run. If it is close to or less than eighty years you should expect problems on re-sale, so it is recommended to arrange for a lease extension before purchasing. It is ideal 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 in advance of the eighty year threshold. Leasehold Reform legislation entitles Carlisle qualifying lessees to an additional term of 90 years on top of the remaining term, at a peppercorn rent (no ground rent). 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.
Leasehold properties in Carlisle with over one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and service charges justify 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors 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 conveyancing solicitor we work with provide it.
Subsequent to protracted discussions with the landlord of her leasehold flat in Carlisle, Kayleigh started the lease extension process just as her lease was approaching the crucial 80-year threshold. The transaction completed in May 2005. The freeholder’s charges were kept to an absolute minimum.
Dr Alfie Hernández completed a studio apartment in Carlisle in August 2007. The dilemma was if we could approximate the premium could be to prolong the lease by 90 years. Similar premises in Carlisle with an extended lease were valued about £257,800. The average amount of ground rent was £65 collected quarterly. The lease ran out in 2091. Given that there were 65 years remaining we estimated the compensation to the freeholder for the lease extension to be within £17,100 and £19,800 plus legals.
Last Autumn we were e-mailed by Mr E Rose , who bought a garden flat in Carlisle in July 2003. The dilemma was if we could shed any light on how much (approximately) premium would likely be for a ninety year lease extension. Identical properties in Carlisle with an extended lease were valued around £191,400. The mid-range ground rent payable was £55 collected annually. The lease termination date was on 14 October 2080. Taking into account 54 years as a residual term we approximated the compensation to the landlord to extend the lease to be between £34,200 and £39,600 exclusive of expenses.