For anyone whose Cowley home is held on a long lease, our message is clear – if no remedial action is taken, your property will eventually revert to your landlord, leaving you empty-handed. The fewer the years remaining the less it is worth and the more expensive it will be to procure a lease extension.
It is generally considered that a residential leasehold with more than one hundred years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 30 years remaining, the residence will be worth the same as a freehold for many years in the future.
| 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Birmingham Midshires | 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 |
| Yorkshire 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. |
Engaging our service will provide you better control over the value of your Cowley leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to lengthy negotiations with the freeholder of her purpose-built apartment in Cowley, Alexandra commenced the lease extension process just as her lease was coming close to the all-important 80-year mark. The legal work was concluded in June 2009. The freeholder’s charges were kept to an absolute minimum.
Last September we were approach by Mr and Mrs. R Wright , who bought a garden apartment in Cowley in January 2005. We are asked if we could estimate the premium would likely be for a 90 year lease extension. Identical flats in Cowley with an extended lease were valued about £300,000. The average ground rent payable was £50 collected quarterly. The lease terminated on 11 July 2102. Having 76 years left we estimated the compensation to the landlord for the lease extension to be between £8,600 and £9,800 exclusive of fees.
An example of a Freehold Enfranchisement decision for a Cowley property is 164 Nestles Avenue in October 2013. The tribunal agreed with the proposed price of £20,158 for the freehold and determined that that sum is the amount to be paid into court This case related to 2 flats. The unexpired residue of the current lease was 69 years.