Unfortunately that a Charmouth residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the Charmouth property market.Once your lease gets to 85ish years, you should start considering a lease extension. If lease term drops below eighty years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property Most flat owners in Charmouth will be able to extend under the legislation; however a conveyancer 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 is instigated and you will need to be guided by your conveyancing solicitor for the duration of the formalities.
Leasehold properties in Charmouth with over 100 years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with procure Charmouth 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 lawyer we work with provide it.
Samuel owned a studio apartment in Charmouth on the market with a lease of a little over 72 years outstanding. Samuel informally spoke with his landlord being a well known London-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years on the basis of an increased rent to £100 yearly. No ground rent would be due on a lease extension were Samuel to exercise his statutory right. Samuel procured expert legal guidance and was able to make an informed decision and handle with the matter and ending up with a market value flat.
Last Winter we were approach by Mr and Mrs. G Collins , who took over the lease of a purpose-built apartment in Charmouth in February 2000. The question was if we could shed any light on how much (roughly) compensation to the landlord would be for a ninety year lease extension. Similar flats in Charmouth with an extended lease were worth £265,200. The mid-range amount of ground rent was £65 invoiced monthly. The lease elapsed on 18 November 2091. Having 66 years unexpired we calculated the compensation to the freeholder for the lease extension to be between £15,200 and £17,600 not including legals.
Ms S Rodríguez purchased a one bedroom apartment in Charmouth in October 2009. The question was if we could estimate the premium could be for a 90 year extension to my lease. Identical properties in Charmouth with 100 year plus lease were worth £198,800. The mid-range amount of ground rent was £55 collected yearly. The lease terminated on 12 June 2080. Taking into account 55 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £33,300 and £38,400 not including professional charges.