It’s an underpublicised certainty that a Cranbrook residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Cranbrook property prices.Once your lease nears 85ish years, you should start thinking about a lease extension. If lease term drops below eighty years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of leasehold owners in Cranbrook will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you qualify for an extension. In some cases you may not qualify. There are also strict deadlines and procedures to follow once the process is initiated and you will need to be guided by your conveyancing solicitor for the duration of the process.
Leasehold residencies in Cranbrook with over 100 years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Cranbrook can be a difficult process. We recommend you obtain guidance from a lawyer and surveyor with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Cranbrook lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Off the back of protracted negotiations with the freeholder of her leasehold apartment in Cranbrook, Phoebe started the lease extension process as the eighty year mark was quickly nearing. The lease extension was finalised in November 2008. The landlord’s charges were restricted to less than 700 GBP.
Last Autumn we were approach by Mr and Mrs. K Hill , who took over the lease of a garden flat in Cranbrook in September 2009. The dilemma was if we could estimate the premium would be for a 90 year extension to my lease. Comparable homes in Cranbrook with 100 year plus lease were in the region of £275,000. The average ground rent payable was £65 billed annually. The lease expired on 1 July 2093. Considering the 68 years outstanding we calculated the compensation to the landlord for the lease extension to be within £13,300 and £15,400 plus expenses.
Last year we were approach by Mr and Mrs. M Rose , who bought a purpose-built apartment in Cranbrook in August 2006. The dilemma was if we could shed any light on how much (roughly) price would likely be for a 90 year lease extension. Similar flats in Cranbrook with 100 year plus lease were valued about £213,600. The mid-range amount of ground rent was £60 billed quarterly. The lease came to a finish in 2082. Considering the 57 years outstanding we approximated the premium to the freeholder to extend the lease to be within £30,400 and £35,200 exclusive of professional charges.