When it comes to residential leasehold premises in Cotswolds, you effectively rent it for a certain period of time. Modern flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you should consider extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease gets disproportionately greater particularly once there are fewer than eighty years left. Leasehold owners in Cotswolds with a lease nearing 81 years left should seriously consider extending it as soon as possible. When the lease term has under 80 years left, under the current statute the landlord can calculate and demand a greater amount, based on a technical multiplication, strangely termed as “marriage value” which is due.
It is conventional wisdom that a property with more than one hundred years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 30 years remaining, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Chelsea Building Society | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with undertake Cotswolds 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 conveyancer we work with provide it.
Finley was the the leasehold proprietor of a conversion apartment in Cotswolds on the market with a lease of a little over 59 years unexpired. Finley informally spoke with his freeholder being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent initially set at £100 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Finley to invoke his statutory right. Finley procured expert legal guidance and was able to make a more informed judgement and deal with the matter and sell the flat.
Ms Niamh Rodríguez owned a basement flat in Cotswolds in April 2003. The dilemma was if we could estimate the price could be to extend the lease by a further 90 years. Similar residencies in Cotswolds with an extended lease were valued around £166,400. The average amount of ground rent was £60 collected monthly. The lease end date was on 20 February 2080. Given that there were 54 years outstanding we approximated the premium to the freeholder to extend the lease to be within £32,300 and £37,400 exclusive of professional charges.
Mr and Mrs. B Morel purchased a one bedroom apartment in Cotswolds in November 2001. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be to prolong the lease by ninety years. Comparative residencies in Cotswolds with an extended lease were in the region of £227,800. The average ground rent payable was £45 invoiced quarterly. The lease termination date was on 16 October 2091. Considering the 65 years left we calculated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 plus costs.