There is no doubt about it a leasehold property in Cotswolds is a wasting asset as a result of the diminishing lease term. If the residual term has, over 99 years remaining then this decrease may be fractional that being said there will become a point in time when a lease has fewer than 80 years remaining as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the main reason why you should consider extending without delay. Many flat owners in Cotswolds will qualify for this right; however a conveyancing solicitor will be able to confirm if you qualify to extend your lease. In limited situations you may not qualify, the most common reason being that you have owned the property for less than two years.
It is generally accepted that a property with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years unexpired, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Engaging our service gives you better control over the value of your Cotswolds leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
William owned a 2 bedroom flat in Cotswolds on the market with a lease of a little over 72 years remaining. William informally spoke with his landlord a well known Bristol-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a rise in the rent to £200 annually. Ordinarily, ground rent would not be payable on a lease extension were William to invoke his statutory right. William procured expert advice and was able to make a more informed decision and handle with the matter and readily saleable.
Mr J Garcia owned a one bedroom flat in Cotswolds in July 2011. The question was if we could estimate the compensation to the landlord would be for a ninety year lease extension. Identical properties in Cotswolds with a long lease were in the region of £280,000. The mid-range ground rent payable was £55 collected yearly. The lease concluded on 24 June 2103. Taking into account 78 years outstanding we approximated the compensation to the landlord for the lease extension to be between £13,300 and £15,400 not including costs.
Last Winter we were e-mailed by Dr Max Lefèvre , who bought a purpose-built apartment in Cotswolds in October 1997. We are asked if we could approximate the price would be for a ninety year extension to my lease. Comparative homes in Cotswolds with an extended lease were worth £186,000. The mid-range amount of ground rent was £65 invoiced every twelve months. The lease came to a finish in 2083. Having 58 years outstanding we calculated the compensation to the freeholder to extend the lease to be within £24,700 and £28,600 plus expenses.