When it comes to residential leasehold property in Bovey Tracey, you effectively rent it for a certain amount of time. In recent years flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you should think about a lease extension sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease gets disproportionately more expensive notably when there are fewer than eighty years remaining. Anyone in Bovey Tracey with a lease approaching 81 years remaining should seriously consider extending it sooner than later. Once a lease has fewer than eighty years left, under the relevant legislation the landlord is entitled to calculate and charge a larger premium, assessed on a technical computation, known as “marriage value” which is payable.
It is generally considered that a property with more than one hundred years remaining is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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 | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with handle Bovey Tracey 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.
Jasper owned a studio apartment in Bovey Tracey being marketed with a lease of just over fifty eight years left. Jasper informally spoke with his landlord a well known Bristol-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent at the outset set at £200 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Jasper to exercise his statutory right. Jasper obtained expert legal guidance and secured an acceptable resolution informally and readily saleable.
Mr Stanley Hall acquired a basement apartment in Bovey Tracey in November 2008. We are asked if we could approximate the premium could be for a ninety year lease extension. Identical homes in Bovey Tracey with 100 year plus lease were worth £203,200. The mid-range ground rent payable was £65 collected quarterly. The lease lapsed on 19 June 2087. Having 61 years remaining we calculated the premium to the freeholder for the lease extension to be within £20,000 and £23,000 exclusive of costs.
In 2009 we were approached by Dr R Taylor who, having bought a ground floor flat in Bovey Tracey in November 2003. The question was if we could approximate the premium would likely be for a 90 year extension to my lease. Comparable properties in Bovey Tracey with an extended lease were in the region of £260,000. The mid-range amount of ground rent was £50 collected monthly. The lease lapsed on 19 August 2098. Considering the 72 years left we estimated the compensation to the freeholder for the lease extension to be between £9,500 and £11,000 exclusive of legals.