Unfortunately that a Soham 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 Soham property market.Where your lease has approximately 90 years left, you should start thinking about 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 dips under eighty years - otherwise a higher amount will be due. The majority of flat owners in Soham will be able to extend under the legislation; however a lawyer will be able to clarify whether you are eligibility. In some situations you may not qualify. There are also strict deadlines and procedures to follow once the process is instigated and you will need to be guided by your lawyer throughout the process.
It is conventional wisdom that a property with more than one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 30 years left, the premises will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service will provide you better control over the value of your Soham leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Tommy was the the leasehold proprietor of a conversion flat in Soham on the market with a lease of fraction over 61 years remaining. Tommy informally contacted his landlord being a well known Bristol-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent at the outset set at £100 per annum and increase every twenty five years thereafter. No ground rent would be payable on a lease extension were Tommy to exercise his statutory right. Tommy procured expert advice and secured an acceptable resolution informally and readily saleable.
Last Autumn we were approach by Dr N André , who bought a recently refurbished apartment in Soham in November 2006. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would likely be to prolong the lease by ninety years. Similar homes in Soham with 100 year plus lease were in the region of £227,800. The average amount of ground rent was £45 billed yearly. The lease elapsed in 2091. Taking into account 65 years outstanding we estimated the premium to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of professional charges.
In 2011 we were contacted by Mr and Mrs. V Michel who, having purchased a first floor flat in Soham in October 1997. The question was if we could estimate the compensation to the landlord could be to prolong the lease by ninety years. Identical premises in Soham with a long lease were in the region of £275,000. The mid-range ground rent payable was £55 collected every twelve months. The lease expired in 2102. Taking into account 76 years unexpired we approximated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 not including costs.