Cranbrook leases on residential deteriorating in value. if your lease has in the region of ninety years left, you should start thinking about a lease extension. If lease term dips under 80 years, you will then have to pay half of the property's 'marriage value' in addition to the standard cost of the lease extension to your landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Flat owners in Cranbrook will mostly qualify for a lease extension; however it’s a good idea to check with a lawyer to confirm if you qualify. In certain cases you may not qualify. There are prescribed timetables and steps to follow once the process has started so it’s sensible to be guided by a conveyancer during the process.
Leasehold premises in Cranbrook with in excess of 100 years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
Regardless of whether you are a tenant or a landlord in Cranbrook,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Cranbrook valuers.
Elijah was the the leasehold owner of a studio apartment in Cranbrook being marketed with a lease of a few days over 72 years unexpired. Elijah informally approached his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to an increased rent to £125 yearly. No ground rent would be due on a lease extension were Elijah to exercise his statutory right. Elijah obtained expert advice and secured satisfactory resolution without going to tribunal and readily saleable.
Dr Leon Flores owned a first floor flat in Cranbrook in August 2006. We are asked if we could estimate the price would be to extend the lease by ninety years. Identical homes in Cranbrook with a long lease were worth £290,000. The average ground rent payable was £45 collected per annum. The lease ended in 2099. Given that there were 73 years remaining we calculated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 plus expenses.
In 2010 we were phoned by Dr Felix Clark who, having completed a one bedroom apartment in Cranbrook in August 1999. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be for a ninety year lease extension. Comparative residencies in Cranbrook with a long lease were valued about £243,000. The average ground rent payable was £65 billed every twelve months. The lease lapsed in 2089. Given that there were 63 years remaining we estimated the premium to the freeholder to extend the lease to be within £20,000 and £23,000 not including expenses.