It’s an underpublicised certainty that a Dawlish 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 reduction being disguised by increases in the Dawlish property prices.Once your lease nears 85ish years, you should start considering a lease extension. If the number of years remaining drops below 80 years, you will then be required to pay 50% of the property's 'marriage value' on top of 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 leasehold owners in Dawlish will be able to extend under the legislation; however a conveyancer should be able to confirm whether you qualify for an extension. In some situations you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer throughout the process.
Leasehold properties in Dawlish with more than one hundred years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges merit it.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Irrespective of whether you are a tenant or a freeholder in Dawlish,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Dawlish valuers.
In 2014 Joshua, started to get near to the 80-year threshold with the lease on his basement flat in Dawlish. In buying his property 18 years previously, the unexpired term was of little relevance. by good luck, he realised he needed to take action soon on Extending the lease. Joshua arranged for a lease extension at the eleventh hour last April. Joshua and the landlord ultimately agreed on a premium of £6,000 . If he not met the deadline, the price would have increased by at least £925.
Last Spring we were called by Dr Toby Girard , who bought a ground floor flat in Dawlish in November 1996. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be for a 90 year extension to my lease. Identical homes in Dawlish with a long lease were worth £191,400. The mid-range ground rent payable was £55 invoiced every twelve months. The lease elapsed in 2078. Given that there were 54 years as a residual term we estimated the premium to the landlord to extend the lease to be between £34,200 and £39,600 exclusive of legals.
Mrs J Richardson owned a purpose-built flat in Dawlish in January 1997. We are asked if we could estimate the compensation to the landlord would likely be to extend the lease by an additional years. Similar homes in Dawlish with an extended lease were worth £295,000. The mid-range amount of ground rent was £45 collected per annum. The lease came to a finish in 2098. Considering the 74 years left we estimated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 exclusive of fees.