The market value of Cimla leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can escalate significantly once the remaining term is less than eighty years
Leasehold properties in Cimla with more than 100 years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little upside in purchasing 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Godiva Mortgages | 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a freeholder in Cimla,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Cimla valuers.
After lengthy correspondence with the landlord of her purpose-built apartment in Cimla, Lauren initiated the lease extension process just as the lease was coming close to the crucial 80-year mark. The legal work was concluded in March 2014. The landlord’s fees were restricted to about 450 pounds.
Last Spring we were e-mailed by Mr and Mrs. M Cooper , who completed a basement apartment in Cimla in January 1996. The question was if we could approximate the premium would likely be for a ninety year lease extension. Comparable flats in Cimla with 100 year plus lease were in the region of £186,000. The mid-range amount of ground rent was £65 invoiced yearly. The lease ran out on 24 May 2084. Given that there were 58 years unexpired we approximated the compensation to the landlord for the lease extension to be within £24,700 and £28,600 exclusive of professional charges.
Last Winter we were approach by Mr T Lambert , who was assigned a lease of a basement apartment in Cimla in September 2008. We are asked if we could approximate the compensation to the landlord would be to prolong the lease by 90 years. Comparable flats in Cimla with 100 year plus lease were in the region of £250,000. The mid-range ground rent payable was £50 invoiced quarterly. The lease ran out on 4 July 2095. Considering the 69 years outstanding we calculated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 not including costs.