For those whose Cimla property is held on a long lease, the message is clear – if no remedial action is taken, the property will ultimately revert to your landlord, leaving you empty-handed. The shorter the lease the less it is worth and the more expensive it will be to obtain a lease extension.
It is conventional wisdom that a property with in excess of 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 30 years remaining, the residence 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Regardless of whether you are a tenant or a freeholder in Cimla,the lease extension solicitors that we work with will always be prepared 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.
In recent months Eliot, started to get near to the 80-year mark with the lease on his studio apartment in Cimla. Having purchased his flat 18 years previously, the unexpired term was of minimal concern. As luck would have it, he noticed he needed to take steps soon on a lease extension. Eliot was able to extend his lease at the eleventh hour last March. Eliot and the freeholder via the managing agents eventually agreed on a premium of £5,000 . If he not met the deadline, the amount would have gone up by at least £875.
Last June we were phoned by Mr and Mrs. D Mitchell , who bought a purpose-built apartment in Cimla in October 2007. The dilemma was if we could estimate the price would likely be for a 90 year lease extension. Similar premises in Cimla with 100 year plus lease were worth £218,000. The average amount of ground rent was £45 billed every twelve months. The lease came to a finish on 18 January 2088. Taking into account 63 years as a residual term we approximated the premium to the landlord to extend the lease to be within £17,100 and £19,800 not including fees.
Last month we were phoned by Dr Isabel Hernández , who completed a ground floor flat in Cimla in February 2002. The question was if we could shed any light on how much (roughly) compensation to the landlord would be to prolong the lease by an additional years. Similar properties in Cimla with an extended lease were worth £265,000. The average ground rent payable was £50 billed per annum. The lease ran out in 2099. Having 74 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 not including legals.