Unfortunately that a Cirencester residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Cirencester property prices.Once your lease nears 85ish years, you should start thinking about a lease extension. If the number of years remaining dips under eighty years, you will end up paying 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Cirencester will be able to extend under the legislation; however a lawyer should be able to confirm whether you are eligibility. In some situations you may not qualify. There are also strict deadlines and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
It is generally accepted that a property with more than 100 years remaining is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | |
| Barnsley Building Society | |
| Chelsea Building Society | |
| Coventry Building Society | |
| Santander |
The conveyancers that we work with procure Cirencester 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.
Noah owned a 2 bedroom apartment in Cirencester on the market with a lease of a little over 72 years unexpired. Noah informally spoke with his freeholder being a well known Manchester-based freehold company for a lease extension. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £200 yearly. Ordinarily, ground rent would not be payable on a lease extension were Noah to exercise his statutory right. Noah obtained expert advice and was able to make an informed decision and deal with the matter and readily saleable.
In 2013 we were called by Dr Madeleine Roux who, having moved into a one bedroom apartment in Cirencester in January 2004. The question was if we could estimate the compensation to the landlord could be for a ninety year lease extension. Similar flats in Cirencester with an extended lease were in the region of £166,400. The mid-range ground rent payable was £60 billed every twelve months. The lease came to a finish in 2080. Given that there were 54 years unexpired we approximated the premium to the freeholder for the lease extension to be between £32,300 and £37,400 plus professional charges.
Mr and Mrs. W Díaz owned a purpose-built flat in Cirencester in April 2002. The question was if we could approximate the price would be for a ninety year extension to my lease. Identical flats in Cirencester with a long lease were valued about £227,800. The average amount of ground rent was £45 collected quarterly. The lease finished in 2091. Given that there were 65 years left we estimated the compensation to the landlord for the lease extension to be between £13,300 and £15,400 not including expenses.