It’s an underpublicised certainty that a Cottingham residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the Cottingham property prices.Once your lease gets to 85ish years, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips under 80 years - otherwise a higher amount will be payable. Most flat owners in Cottingham will be able to extend under the legislation; however a conveyancer will be able to clarify if you qualify for an extension. In some cases you may not qualify. There are also strict timetables and procedures to be adhered to once the process is initiated and you will need to be guided by your lawyer throughout the process.
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to any lease with more than 30 years left, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
Engaging our service gives you increased control over the value of your Cottingham leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to unsuccessful negotiations with the freeholder of her basement flat in Cottingham, Millie started the lease extension process as the eighty year threshold was rapidly nearing. The legal work was concluded in February 2005. The landlord’s charges were negotiated to slightly above 550 GBP.
Last Spring we were approach by Mr and Mrs. A Anderson , who moved into a first floor flat in Cottingham in March 2007. The question was if we could estimate the premium would likely be to prolong the lease by 90 years. Similar residencies in Cottingham with an extended lease were worth £193,400. The average amount of ground rent was £65 collected quarterly. The lease ended in 2084. Having 59 years outstanding we calculated the compensation to the freeholder for the lease extension to be between £21,900 and £25,200 plus costs.
Mr and Mrs. C Rogers purchased a first floor apartment in Cottingham in August 2009. The dilemma was if we could estimate the premium could be for a ninety year lease extension. Similar premises in Cottingham with an extended lease were worth £255,000. The average amount of ground rent was £50 collected yearly. The lease finished in 2095. Given that there were 70 years left we calculated the premium to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of fees.