The value of Lynton leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can increase substantially once the remaining term is less than 80 years
Leasehold residencies in Lynton with in excess of one hundred years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you increased control over the value of your Lynton leasehold, as your property will be more valuable and saleable in relation to the lease length should you want to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Archie owned a conversion apartment in Lynton on the market with a lease of fraction over 72 years outstanding. Archie informally approached his freeholder being a well known local-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent to start with set at £200 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Archie to invoke his statutory right. Archie procured expert advice and secured an acceptable deal informally and ending up with a market value flat.
In 2010 we were approached by Mr and Mrs. S Howard who, having bought a studio flat in Lynton in November 1997. We are asked if we could approximate the premium could be to extend the lease by an additional years. Similar homes in Lynton with a long lease were worth £285,000. The average ground rent payable was £45 billed annually. The lease elapsed on 11 August 2096. Having 71 years unexpired we approximated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of expenses.
Last Summer we were approach by Dr M Carter , who was assigned a lease of a first floor flat in Lynton in March 2003. We are asked if we could approximate the price could be to prolong the lease by a further 90 years. Comparable premises in Lynton with an extended lease were valued around £225,800. The average ground rent payable was £60 billed annually. The lease came to a finish in 2085. Having 60 years left we calculated the compensation to the landlord to extend the lease to be between £23,800 and £27,400 not including legals.