Why you should commence your Exmouth lease extension

Why you should commence your Exmouth lease extension today:

Increase your lease and increase your Exmouth property value

There is no doubt about it a leasehold property in Exmouth is a wasting asset as a result of the diminishing lease term. Where the lease has, over 100 years to run then this decrease may be of little impact nevertheless there will become a stage when a lease has fewer than 80 years remaining as part of the premium you will incur is what is known as a marriage value. This could increase sharply the cost. It is the primary logic behind why you should extend the lease sooner rather than later. The majority of flat owners in Exmouth will qualify for this right; that being said a conveyancing solicitor can advise if you are eligible to extend your lease. In limited situations you may not qualify, the most common reason being that you have owned the property for under two years.

An extended lease has roughly the same value as a freehold

Leasehold properties in Exmouth with in excess of one hundred years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and estate charges warrant it.

Lending institutions may not issue a mortgage on a short lease

Most banks and building societies will be unwilling to grant a mortgage on a lease with under 70 years remaining - although this varies from lender to lender. A buyer will undoubtedly find it difficult in obtaining a mortgage and this will result in your Exmouth property being difficult to sell or to obtain finance on.

Get in touch with one of our Exmouth lease extension solicitors or enfranchisement solicitors

The lawyers that we work with undertake Exmouth 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 lawyer we work with provide it.

Exmouth Lease Extension Case Studies:

George, Exmouth, Devon

In 2014 George, came dangerously near to the 80-year mark with the lease on his two bedroom flat in Exmouth. In buying his home two decades ago, the length of the lease was of minimal importance. Thankfully, he noticed he would soon be paying way over the odds for Extending the lease. George extended the lease just under the wire last January. George and the freeholder via the managing agents subsequently settled on an amount of £5,500 . If he had missed the deadline, the premium would have become more exhorbitant by a minimum £1,025.

Exmouth case:

Last year we were called by Mr and Mrs. E Wood , who took over the lease of a one bedroom flat in Exmouth in April 2007. The question was if we could shed any light on how much (roughly) premium would likely be for a 90 year extension to my lease. Identical premises in Exmouth with a long lease were in the region of £285,000. The average amount of ground rent was £55 invoiced yearly. The lease lapsed on 25 October 2105. Having 79 years as a residual term we estimated the compensation to the freeholder to extend the lease to be between £13,300 and £15,400 plus fees.

Exmouth case:

Ms Shannon Ward was assigned a lease of a ground floor flat in Exmouth in May 1996. The question was if we could estimate the premium could be for a 90 year lease extension. Comparative residencies in Exmouth with an extended lease were in the region of £193,400. The mid-range ground rent payable was £65 collected annually. The lease finished on 28 July 2085. Considering the 59 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £21,900 and £25,200 plus costs.