As the the remaining lease term of a Cudham residential lease diminished so does its value and therefore the value of your property. If the lease has, more than 125 years to run then this decrease may be of little impact that being said there will become a stage when a lease has less than 80 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 rational as to why you should consider extending sooner than later. Most flat owners in Cudham will meet the qualifying criteria; that being said a conveyancer will be able to advise whether you are eligible to extend your lease. In limited situations you may not qualify, the most frequent reason being that you have owned the property for under two years.
It is generally accepted that a property with over one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years left, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
| 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 |
The lawyers that we work with undertake Cudham lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Zachary was the the leasehold proprietor of a 2 bedroom flat in Cudham being sold with a lease of just over 72 years unexpired. Zachary on an informal basis contacted his freeholder being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £150 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Zachary to exercise his statutory right. Zachary procured expert legal guidance and was able to make an informed judgement and deal with the matter and sell the property.
In 2011 we were approached by Mr and Mrs. S André who, having purchased a one bedroom flat in Cudham in February 2005. The dilemma was if we could estimate the price would be to extend the lease by a further 90 years. Identical residencies in Cudham with 100 year plus lease were worth £245,000. The mid-range amount of ground rent was £45 billed quarterly. The lease came to a finish in 2092. Given that there were 68 years left we approximated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 exclusive of professional charges.
An example of a Lease Extension decision for a Cudham flat is 1 Southlands Court Southlands Road in September 2013. The Leasehold Valuation Tribunal determined that the premium to be paid by the tenant on the grant of a new lease, in accordance with section 56 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 was £30,541 This case affected 1 flat. The unexpired residue of the current lease was 50.57 years.