Unfortunately that a Barnstaple residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Barnstaple property prices.Where your lease has approximately 90 years left, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips lower than 80 years - otherwise a higher premium will be payable. The majority of flat owners in Barnstaple will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you qualify for an extension. In some cases you may not be entitled. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your lawyer from beginning to end of the process.
It is generally considered that a property with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Halifax | Minimum 70 years from the date 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 lawyers that we work with undertake 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.
Evan was the the leasehold proprietor of a conversion flat in Barnstaple being sold with a lease of fraction over fifty eight years remaining. Evan on an informal basis approached his landlord being a well known Bristol-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 an increased rent to £200 per annum. Ordinarily, ground rent would not be payable on a lease extension were Evan to invoke his statutory right. Evan procured expert advice and was able to make an informed decision and deal with the matter and ending up with a market value flat.
In 2014 we were approached by Mr and Mrs. G Watson who, having was assigned a lease of a one bedroom flat in Barnstaple in February 2005. We are asked if we could shed any light on how much (approximately) price would likely be to extend the lease by 90 years. Identical premises in Barnstaple with an extended lease were in the region of £290,000. The average amount of ground rent was £60 collected yearly. The lease elapsed in 2105. Having 80 years outstanding we estimated the premium to the freeholder for the lease extension to be between £13,300 and £15,400 not including expenses.
Last year we were contacted by Ms Alicia Laurent , who owned a purpose-built flat in Barnstaple in May 2008. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be for a 90 year lease extension. Identical flats in Barnstaple with an extended lease were worth £200,800. The mid-range ground rent payable was £65 billed per annum. The lease ran out on 19 September 2085. Having 60 years outstanding we approximated the compensation to the landlord to extend the lease to be between £20,900 and £24,200 not including professional charges.