As the the remaining lease term of a Charterhouse domestic lease decreases so does its value and therefore the value of your property. If the lease has, in excess of one hundred years to run then this decrease may be of little impact that being said there will become a stage when a lease has less than 80 years unexpired as part of the premium you will incur is what is known as a marriage value. This could increase markedly the cost. It is the main reason why you should extend the lease without delay. The majority of flat owners in Charterhouse will meet the qualifying criteria; that being said a lawyer will be able to advise if you are eligible to extend your lease. In certain situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
It is generally considered that a residential leasehold with over 100 years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 30 years left, the premises will be equivalent in value to a freehold for decades to come.
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
Engaging our service gives you enhanced control over the value of your Charterhouse leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Tyler was the the leasehold proprietor of a 2 bedroom flat in Charterhouse on the market with a lease of just over sixty years remaining. Tyler informally spoke with his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent at the outset set at £200 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Tyler to exercise his statutory right. Tyler obtained expert advice and secured an acceptable resolution without resorting to tribunal and readily saleable.
In 2013 we were approached by Mrs G Carter who, having owned a studio apartment in Charterhouse in November 2002. We are asked if we could shed any light on how much (roughly) price could be to prolong the lease by 90 years. Similar residencies in Charterhouse with an extended lease were valued about £198,800. The mid-range amount of ground rent was £55 invoiced quarterly. The lease end date was in 2080. Considering the 55 years left we estimated the compensation to the freeholder to extend the lease to be between £33,300 and £38,400 exclusive of costs.
An example of a Lease Extension decision for a Charterhouse residence is Flat 89 Trinity Court Grays Inn Road in February 2013. the Tribunal found that the premium to be paid by the tenant on the grant of a new lease, in accordance with section 56 and Schedule 13 to the Leasehold Reform, Housing and Urban Development Act 1993 should be £36,229. This case affected 1 flat. The unexpired residue of the current lease was 66.8 years.