Cambourne leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. Legislation has been in place for sometime now which permits qualifying Cambourne residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Cambourne you must check if your lease has between seventy and ninety years left. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth roughly the equivalent as a freehold. Where an further ninety years added to any lease with more than 30 years left, the residence will be equivalent in value to 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with undertake Cambourne 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 conveyancer we work with provide it.
In recent months John, came very near to the eighty-year mark with the lease on his garden apartment in Cambourne. Having purchased his property two decades ago, the lease term was of no relevance. Fortunately, he realised he needed to take steps soon on Extending the lease. John arranged for a lease extension at the eleventh hour in September. John and the freeholder eventually settled on the final figure of £5,000 . If he had missed the deadline, the amount would have increased by at least £1,100.
In 2011 we were contacted by Mr and Mrs. U Alexander who, having was assigned a lease of a purpose-built flat in Cambourne in October 2000. The dilemma was if we could estimate the compensation to the landlord could be to extend the lease by 90 years. Comparable residencies in Cambourne with a long lease were worth £254,200. The average ground rent payable was £60 collected per annum. The lease expired on 19 January 2077. Having 51 years remaining we calculated the compensation to the landlord to extend the lease to be within £43,700 and £50,600 exclusive of expenses.
Last Christmas we were called by Mr and Mrs. U Stewart , who purchased a garden flat in Cambourne in November 2006. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would likely be for a ninety year extension to my lease. Similar premises in Cambourne with an extended lease were worth £210,600. The mid-range amount of ground rent was £45 billed every twelve months. The lease finished on 18 August 2088. Given that there were 62 years as a residual term we estimated the premium to the landlord for the lease extension to be between £18,100 and £20,800 plus costs.