The value of Brixham leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can escalate significantly once the unexpired lease term is less than 80 years
Leasehold properties in Brixham with more than one hundred years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| 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. |
| 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. |
| 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. |
The conveyancers that we work with undertake Brixham 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 conveyancing solicitor we work with provide it.
In recent months Edward, came precariously close to the 80-year threshold with the lease on his first floor apartment in Brixham. In buying his property two decades ago, the length of the lease was of little significance. Luckily, he noticed he would imminently be paying an escalated premium for a lease extension. Edward extended the lease just under the wire last September. Edward and the landlord subsequently agreed on the final figure of £5,500 . If he not met the deadline, the sum would have increased by at least £1,000.
Dr E Ali completed a first floor flat in Brixham in April 2006. The dilemma was if we could approximate the price would be to extend the lease by 90 years. Comparative properties in Brixham with an extended lease were in the region of £260,000. The average amount of ground rent was £50 billed quarterly. The lease concluded on 22 August 2096. Taking into account 71 years as a residual term we approximated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 not including costs.
Mr and Mrs. S Adams owned a one bedroom apartment in Brixham in October 2011. The question was if we could shed any light on how much (roughly) compensation to the landlord could be to prolong the lease by 90 years. Identical premises in Brixham with 100 year plus lease were worth £254,200. The average amount of ground rent was £60 collected annually. The lease expired in 2076. Considering the 51 years left we calculated the premium to the landlord to extend the lease to be between £43,700 and £50,600 exclusive of fees.