Cottenham 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 gets more expensive. It is the case that most Cottenham tenants have the right to extend their lease by an additional 90 years under the 1993 Leasehold Reform Act. If you are a leasehold owner in Cottenham you should investigate if your lease has between 70 and 90 years left. There are compelling reasons why a Cottenham flat owner with a lease having around 80 years remaining should take action to ensure that a lease extension is put in place without delay
Leasehold properties in Cottenham with in excess of 100 years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you enhanced control over the value of your Cottenham leasehold, as your property will be more valuable and saleable in respect of lease length should you decide to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Twenty four months ago Arthur, started to get near to the eighty-year mark with the lease on his basement apartment in Cottenham. In buying his home 19 years previously, the lease term was of minimal bearing. Luckily, he recognised he needed to take action soon on a lease extension. Arthur extended the lease at the eleventh hour in August. Arthur and the landlord who owned the flat above ultimately settled on the final figure of £6,000 . If he not met the deadline, the amount would have escalated by a minimum £1,000.
In 2014 we were phoned by Mr and Mrs. E Hernández who, having bought a newly refurbished flat in Cottenham in January 2009. The question was if we could estimate the compensation to the landlord would be to extend the lease by an additional years. Similar premises in Cottenham with a long lease were worth £223,400. The average ground rent payable was £60 invoiced monthly. The lease terminated in 2084. Having 59 years outstanding we approximated the compensation to the freeholder to extend the lease to be within £27,600 and £31,800 plus legals.
In 2010 we were e-mailed by Mrs U White who, having took over the lease of a studio flat in Cottenham in November 2001. We are asked if we could estimate the premium could be for a ninety year lease extension. Identical properties in Cottenham with an extended lease were worth £210,000. The average amount of ground rent was £50 billed per annum. The lease ended on 28 September 2104. Taking into account 79 years as a residual term we estimated the compensation to the freeholder to extend the lease to be within £8,600 and £9,800 exclusive of expenses.