Lynton leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Lynton residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Lynton you should check if your lease has between seventy and ninety years left. In particular once the remaining lease term slips under 80 years, the amount payable for any lease extension sharply increases as part of the premium you will incur is what is known as a marriage value
It is generally accepted that a property with in excess of 100 years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with handle Lynton 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 conveyancer we work with provide it.
Harrison was the the leasehold proprietor of a conversion apartment in Lynton being marketed with a lease of a little over 59 years unexpired. Harrison on an informal basis spoke with his freeholder being a well known local-based freehold company and enquired on a premium to extend the lease. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £125 annually. Ordinarily, ground rent would not be payable on a lease extension were Harrison to exercise his statutory right. Harrison obtained expert advice and secured an acceptable deal without going to tribunal and sell the flat.
Last month we were contacted by Mr I Baker , who owned a purpose-built flat in Lynton in October 1996. The question was if we could estimate the premium would be to prolong the lease by ninety years. Identical premises in Lynton with an extended lease were in the region of £223,400. The average ground rent payable was £60 invoiced yearly. The lease concluded on 17 August 2084. Given that there were 59 years remaining we estimated the compensation to the freeholder for the lease extension to be within £27,600 and £31,800 not including professional charges.
Mr and Mrs. E Torres took over the lease of a basement apartment in Lynton in March 2005. The question was if we could shed any light on how much (roughly) price would be to extend the lease by an additional years. Identical premises in Lynton with an extended lease were valued about £205,000. The average amount of ground rent was £50 invoiced annually. The lease termination date was in 2104. Given that there were 79 years remaining we calculated the premium to the landlord to extend the lease to be within £8,600 and £9,800 plus legals.