There is no doubt about it a leasehold flat or house in Cranfield is a wasting asset as a result of the shortening lease. Where the residual term has, in excess of 125 years to run then this decrease may be of little impact nevertheless there will become a point in time when a lease has under than eighty years unexpired as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the main logic behind why you should extend the lease without delay. Most flat owners in Cranfield will qualify for this right; that being said a lawyer will be able to confirm whether you qualify for a lease extension. In limited situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
Leasehold residencies in Cranfield with over one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. 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 |
|---|---|
| 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 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
Irrespective of whether you are a tenant or a freeholder in Cranfield,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 Cranfield valuers.
Luke owned a 2 bedroom apartment in Cranfield being marketed with a lease of just over 61 years remaining. Luke informally contacted his freeholder being a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £200 per annum. No ground rent would be payable on a lease extension were Luke to invoke his statutory right. Luke procured expert legal guidance and was able to make an informed judgement and handle with the matter and sell the property.
In 2010 we were phoned by Dr Kyle Peterson who, having owned a ground floor flat in Cranfield in May 2007. The dilemma was if we could estimate the price could be for a ninety year extension to my lease. Comparable premises in Cranfield with 100 year plus lease were valued about £242,600. The mid-range ground rent payable was £45 invoiced quarterly. The lease lapsed in 2093. Having 67 years remaining we estimated the premium to the landlord for the lease extension to be between £11,400 and £13,200 not including professional charges.
Ms U Wood owned a first floor apartment in Cranfield in October 2009. The question was if we could shed any light on how much (approximately) price would likely be to prolong the lease by ninety years. Identical homes in Cranfield with 100 year plus lease were in the region of £280,000. The mid-range amount of ground rent was £55 invoiced monthly. The lease finished on 9 June 2104. Given that there were 78 years as a residual term we calculated the compensation to the landlord for the lease extension to be between £13,300 and £15,400 not including professional charges.