It’s an underpublicised certainty that a Brixham residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the deflation being disguised by increases in the Brixham property prices.Once your lease gets to 85ish years, you need to start thinking about a lease extension. If the number of years remaining drops below eighty years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property The majority of flat owners in Brixham will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify if you qualify for an extension. In some situations you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the process.
It is generally accepted that a property with in excess of 100 years remaining is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be worth the same as a freehold for many years ahead.
Lender | Requirement |
---|---|
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. |
Halifax | Minimum 70 years from the date 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 |
TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with procure Brixham 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.
During the course of the last few months Gabriel, came seriously near to the eighty-year threshold with the lease on his studio apartment in Brixham. Having purchased his home 18 years previously, the unexpired term was of little significance. Luckily, it dawned on him that he needed to take steps soon on Extending the lease. Gabriel extended the lease at the eleventh hour last August. Gabriel and the landlord ultimately agreed on an amount of £6,000 . If he had missed the deadline, the figure would have gone up by at least £950.
In 2013 we were approached by Mr and Mrs. Y Leroy who, having was assigned a lease of a first floor flat in Brixham in October 2001. We are asked if we could estimate the compensation to the landlord would be to prolong the lease by a further 90 years. Comparative flats in Brixham with a long lease were valued about £181,200. The mid-range ground rent payable was £65 collected yearly. The lease came to a finish on 11 January 2080. Considering the 56 years left we approximated the compensation to the landlord for the lease extension to be within £29,500 and £34,000 not including expenses.
In 2011 we were e-mailed by Dr O Hall who, having acquired a ground floor apartment in Brixham in February 1999. The question was if we could estimate the price could be for a ninety year lease extension. Comparable flats in Brixham with a long lease were worth £242,600. The average ground rent payable was £45 collected per annum. The lease ended in 2091. Given that there were 67 years remaining we approximated the premium to the landlord for the lease extension to be between £11,400 and £13,200 exclusive of expenses.