Dorchester leases on domestic properties are gradually losing value. if your lease has about ninety years remaining, you should start thinking about a lease extension. If lease term is under eighty years, you will then have to pay half of the property's 'marriage value' in addition to the standard cost of the lease extension to your landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Flat owners in Dorchester will mostly qualify for a lease extension; however a solicitor will check if you qualify. In certain situations you may not qualify. There are also strict timetables and procedures to follow once the process is initiated so it’s sensible to be guided by a conveyancing solicitor during the process.
It is conventional wisdom that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 45 years unexpired, the property will be equivalent in value to a freehold for many years in the future.
| 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. |
| Chelsea Building Society | 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
Using our service will provide you enhanced control over the value of your Dorchester leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of protracted correspondence with the freeholder of her studio apartment in Dorchester, Mia started the lease extension process as the eighty year deadline was quickly approaching. The transaction was concluded in May 2012. The freeholder’s charges were kept to an absolute minimum.
In 2014 we were phoned by Mr Edward Johnson who, having was assigned a lease of a ground floor flat in Dorchester in April 2000. We are asked if we could estimate the compensation to the landlord could be for a 90 year lease extension. Identical properties in Dorchester with an extended lease were in the region of £270,000. The mid-range ground rent payable was £55 billed quarterly. The lease came to a finish in 2100. Given that there were 75 years as a residual term we estimated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 not including professional charges.
Mr H Brooks owned a one bedroom flat in Dorchester in September 2004. The dilemma was if we could approximate the compensation to the landlord could be to prolong the lease by an additional years. Identical properties in Dorchester with 100 year plus lease were valued about £168,800. The mid-range ground rent payable was £60 invoiced annually. The lease concluded in 2080. Having 55 years remaining we estimated the premium to the landlord to extend the lease to be between £31,400 and £36,200 not including legals.