When it comes to residential leasehold premises in Cockermouth, you are actually buying an entitlement to reside in a property for a set period of time. Modern flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you should consider extending the lease sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately greater notably when there are fewer than 80 years remaining. Anyone in Cockermouth with a lease approaching 81 years remaining should seriously consider extending it without delay. Once the lease term has under 80 years outstanding, under the relevant legislation the freeholder can calculate and demand a greater amount, based on a technical computation, known as “marriage value” which is payable.
It is conventional wisdom that a property with in excess of 100 years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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 |
Using our service will provide you enhanced control over the value of your Cockermouth leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last year Alexander, started to get near to the eighty-year mark with the lease on his first floor flat in Cockermouth. In buying his flat twenty years ago, the unexpired term was of no importance. Thankfully, he realised he needed to take action soon on Extending the lease. Alexander was able to extend his lease at the eleventh hour last March. Alexander and the landlord eventually settled on a premium of £5,500 . If he failed to meet the deadline, the price would have escalated by at least £1,025.
Last Winter we were phoned by Dr M Roux , who bought a garden apartment in Cockermouth in November 2007. We are asked if we could estimate the premium would likely be to prolong the lease by 90 years. Comparable flats in Cockermouth with an extended lease were in the region of £280,000. The average amount of ground rent was £45 collected annually. The lease lapsed on 6 April 2094. Having 69 years outstanding we estimated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 not including expenses.
Last Spring we were e-mailed by Mr and Mrs. O Rogers , who took over the lease of a first floor flat in Cockermouth in April 2011. We are asked if we could approximate the price would likely be for a 90 year lease extension. Similar flats in Cockermouth with 100 year plus lease were valued around £218,400. The mid-range ground rent payable was £60 collected annually. The lease lapsed in 2084. Given that there were 59 years as a residual term we calculated the compensation to the freeholder for the lease extension to be between £27,600 and £31,800 not including fees.