The market value of a leasehold property in Chulmleigh depends on how many years the lease has remaining. If it is near to or less than 80 years you should envisage difficulties on re-sale, so it is recommended to arrange for a lease extension prior to buying. Ideally one should start the lease extension process when a lease still has 82 years remaining so that all matters can be addressed ahead of the 80 year cut off point. Current legislation enables Chulmleigh qualifying lessees to an additional term of ninety years over and above the remaining term, at a peppercorn rent (no ground rent). The purpose of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is conventional wisdom that a residential leasehold with more than one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a freeholder in Chulmleigh,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Chulmleigh valuers.
18 months ago Logan, came critically near to the 80-year threshold with the lease on his garden apartment in Chulmleigh. Having purchased his home 18 years previously, the lease term was of little interest. Fortunately, he realised he needed to take action soon on a lease extension. Logan arranged for a lease extension at the eleventh hour in May. Logan and the freeholder eventually agreed on the final figure of £5,000 . If he had missed the deadline, the amount would have increased by a minimum £1,150.
Last Spring we were e-mailed by Dr R Baker , who owned a ground floor flat in Chulmleigh in April 2004. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be for a ninety year extension to my lease. Comparable residencies in Chulmleigh with an extended lease were in the region of £290,000. The mid-range ground rent payable was £45 invoiced monthly. The lease came to a finish on 12 November 2099. Taking into account 73 years left we estimated the premium to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of expenses.
In 2014 we were phoned by Mr H Cox who, having acquired a basement apartment in Chulmleigh in August 2009. The dilemma was if we could approximate the compensation to the landlord could be to extend the lease by 90 years. Similar residencies in Chulmleigh with 100 year plus lease were valued around £235,600. The mid-range amount of ground rent was £60 collected annually. The lease end date was in 2088. Having 62 years left we calculated the compensation to the freeholder to extend the lease to be within £21,900 and £25,200 not including fees.