Bideford leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. Legislation has been in place for sometime now which entitles qualifying Bideford residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Bideford you should see if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension sharply increases as part of the premium you pay is what is known as a marriage value
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Chelsea Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
| Godiva Mortgages | 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Yorkshire Building Society | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
Regardless of whether you are a tenant or a landlord in Bideford,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Bideford valuers.
Last October Liam, came seriously close to the eighty-year mark with the lease on his purpose- built apartment in Bideford. In buying his home two decades ago, the length of the lease was of no importance. Luckily, he noticed he would soon be paying an escalated premium for a lease extension. Liam was able to extend his lease just in the nick of time in April. Liam and the landlord eventually settled on a premium of £5,000 . If he failed to meet the deadline, the figure would have gone up by a minimum £1,050.
Last year we were contacted by Mrs O Cook , who acquired a ground floor apartment in Bideford in August 2011. The dilemma was if we could estimate the compensation to the landlord could be to extend the lease by ninety years. Comparable properties in Bideford with an extended lease were worth £205,000. The average amount of ground rent was £50 billed every twelve months. The lease expiry date was on 22 June 2105. Given that there were 79 years unexpired we calculated the premium to the landlord for the lease extension to be within £7,600 and £8,800 plus fees.
Last Spring we were called by Mr and Mrs. A Gray , who moved into a one bedroom apartment in Bideford in September 1998. The dilemma was if we could approximate the premium would be for a 90 year lease extension. Comparable premises in Bideford with an extended lease were in the region of £270,000. The average amount of ground rent was £65 billed per annum. The lease concluded on 1 June 2094. Having 68 years outstanding we estimated the premium to the landlord for the lease extension to be within £12,400 and £14,200 exclusive of costs.