Delabole leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Delabole residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Delabole you should check if your lease has between seventy and ninety years left. There are good reasons why a Delabole leaseholder with a lease having around 80 years remaining should take steps to ensure that a lease extension is effected without delay
Leasehold premises in Delabole with over 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges justify 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. |
| Coventry Building Society | 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. |
| 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. |
Engaging our service will provide you increased control over the value of your Delabole leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Last year Austin, came seriously close to the 80-year mark with the lease on his two bedroom flat in Delabole. Having bought his flat 18 years previously, the length of the lease was of minimal relevance. As luck would have it, he recognised he needed to take steps soon on Extending the lease. Austin arranged for a lease extension just under the wire in July. Austin and the freeholder via the management company in the end settled on an amount of £6,000 . If the lease had fallen below eighty years, the sum would have gone up by at least £1,100.
In 2009 we were contacted by Mr Lucas Hernández who, having took over the lease of a one bedroom flat in Delabole in November 2001. The question was if we could approximate the premium would likely be for a 90 year extension to my lease. Comparative flats in Delabole with an extended lease were in the region of £181,600. The average ground rent payable was £55 billed every twelve months. The lease lapsed in 2077. Considering the 52 years outstanding we calculated the compensation to the freeholder to extend the lease to be within £30,400 and £35,200 not including legals.
Last Christmas we were e-mailed by Mr and Mrs. I Lefebvre , who purchased a purpose-built apartment in Delabole in September 2008. The dilemma was if we could estimate the premium would be to prolong the lease by an additional years. Identical properties in Delabole with an extended lease were in the region of £285,000. The average ground rent payable was £45 billed per annum. The lease expiry date was in 2097. Considering the 72 years outstanding we approximated the premium to the landlord to extend the lease to be within £12,400 and £14,200 plus costs.