The market value of Cowes leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can increase materialy once the unexpired lease term is less than 80 years
Leasehold properties in Cowes with in excess of one hundred years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges warrant it.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a landlord in Cowes,the lease extension lawyers 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 Cowes valuers.
Following protracted negotiations with the freeholder of her first floor flat in Cowes, Morgan commenced the lease extension process just as her lease was approaching the crucial 80-year threshold. The transaction was finalised in September 2006. The landlord’s charges were kept to an absolute minimum.
In 2011 we were e-mailed by Dr Jayden Díaz who, having bought a first floor apartment in Cowes in January 1999. We are asked if we could shed any light on how much (approximately) compensation to the landlord could be to prolong the lease by 90 years. Similar flats in Cowes with an extended lease were in the region of £200,800. The mid-range amount of ground rent was £65 collected annually. The lease came to a finish in 2086. Given that there were 60 years remaining we calculated the compensation to the landlord to extend the lease to be between £20,900 and £24,200 not including costs.
Mrs Laura Baker purchased a studio flat in Cowes in March 1998. We are asked if we could estimate the price would likely be for a ninety year extension to my lease. Identical properties in Cowes with a long lease were in the region of £255,000. The average amount of ground rent was £50 billed quarterly. The lease concluded on 27 May 2097. Considering the 71 years as a residual term we estimated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 plus legals.