It’s a harsh truth that a Cullercoats residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the depreciation being disguised by increases in the Cullercoats property market.Once your lease nears 85ish years, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips lower than eighty years - otherwise a higher premium will be payable. Most leasehold owners in Cullercoats will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm if you qualify for an extension. In some cases you may not qualify. There are also strict timetables and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer throughout the formalities.
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years unexpired, the property 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. |
| 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. |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Cullercoats can be a difficult process. We recommend you obtain professional help from a conveyancer and valuer with experience in lease extensions.
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 in-depth market knowledge dealing with Cullercoats lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Following protracted correspondence with the landlord of her one bedroom apartment in Cullercoats, Olivia started the lease extension process as the eighty year threshold was rapidly coming. The legal work was finalised in June 2005. The landlord’s costs were kept to an absolute minimum.
In 2013 we were called by Mr and Mrs. V Bonnet who, having owned a purpose-built apartment in Cullercoats in June 2003. The question was if we could estimate the compensation to the landlord could be to extend the lease by an additional years. Comparable homes in Cullercoats with an extended lease were worth £267,600. The average ground rent payable was £65 billed per annum. The lease expiry date was on 9 April 2092. Taking into account 67 years as a residual term we estimated the premium to the freeholder for the lease extension to be within £14,300 and £16,400 exclusive of legals.
In 2009 we were e-mailed by Dr S Ramírez who, having purchased a garden flat in Cullercoats in February 1995. We are asked if we could shed any light on how much (roughly) price would likely be for a 90 year lease extension. Comparable premises in Cullercoats with a long lease were valued around £206,200. The average ground rent payable was £55 invoiced monthly. The lease end date was in 2081. Considering the 56 years remaining we estimated the premium to the landlord for the lease extension to be between £31,400 and £36,200 not including professional charges.