Unfortunately that a Crediton residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Crediton property prices.Where your lease has approximately ninety years left, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls lower than eighty years - otherwise a higher amount will be payable. Most leasehold owners in Crediton will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm whether you qualify for an extension. In some situations you may not qualify. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the formalities.
It is conventional wisdom that a residential leasehold with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be worth the same as 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. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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 |
The lawyers that we work with undertake Crediton 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.
Following unsuccessful discussions with the freeholder of her first floor flat in Crediton, Katie initiated the lease extension process as the 80 year mark was quickly approaching. The lease extension completed in July 2011. The landlord’s charges were negotiated to a tad over 650 pounds.
Last April we were called by Mr and Mrs. L Gómez , who owned a one bedroom flat in Crediton in November 2008. The dilemma was if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Similar homes in Crediton with a long lease were valued about £242,600. The mid-range ground rent payable was £45 collected monthly. The lease expired in 2092. Given that there were 67 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £11,400 and £13,200 not including costs.
Last Spring we were e-mailed by Dr Benjamin Watson , who was assigned a lease of a one bedroom apartment in Crediton in February 2009. We are asked if we could estimate the premium would likely be to prolong the lease by an additional years. Similar homes in Crediton with 100 year plus lease were worth £280,000. The mid-range amount of ground rent was £55 collected every twelve months. The lease ended on 26 July 2103. Considering the 78 years outstanding we approximated the premium to the landlord to extend the lease to be between £13,300 and £15,400 not including expenses.