The market value of Barnstaple 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 significantly once the remaining term is less than 80 years
It is conventional wisdom that a property with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with handle Barnstaple 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.
In the wake of eight months of unsuccessful discussions with the freeholder of her two bedroom flat in Barnstaple, Hollie initiated the lease extension process just as the lease was approaching the crucial 80-year mark. The legal work completed in May 2007. The landlord’s costs were restricted to slightly above six hundred pounds.
Last Winter we were approach by Mr and Mrs. M Girard , who completed a basement flat in Barnstaple in August 2009. The dilemma was if we could estimate the premium could be for a 90 year lease extension. Similar properties in Barnstaple with 100 year plus lease were valued around £208,200. The mid-range ground rent payable was £65 billed quarterly. The lease terminated in 2086. Having 61 years outstanding we calculated the premium to the freeholder for the lease extension to be within £20,000 and £23,000 plus fees.
In 2013 we were called by Dr Ali Morel who, having acquired a basement flat in Barnstaple in August 2006. The dilemma was if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Identical properties in Barnstaple with an extended lease were in the region of £260,000. The mid-range amount of ground rent was £50 collected annually. The lease end date was on 3 September 2097. Considering the 72 years left we approximated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 not including professional charges.