With a residential leasehold property in Dartmouth Park, you are actually purchasing an entitlement to live in a property for a set period of time. Modern flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you should think about a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly notably once there are fewer than eighty years left. Residents in Dartmouth Park with a lease approaching 81 years left should seriously think of extending it as soon as possible. When a lease has fewer than eighty years left, under the relevant Act the landlord can calculate and charge a larger premium, based on a technical calculation, strangely termed as “marriage value” which is payable.
Leasehold properties in Dartmouth Park with in excess of one hundred years left on the lease are sometimes regarded as a ‘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 to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 procure Dartmouth Park 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 lengthy discussions with the freeholder of her one bedroom flat in Dartmouth Park, Melissa commenced the lease extension process as the eighty year deadline was swiftly approaching. The transaction completed in March 2011. The freeholder’s charges were restricted to approximately 700 GBP.
Ms Imogen Petit acquired a one bedroom flat in Dartmouth Park in August 2012. The question was if we could shed any light on how much (approximately) price would be for a ninety year lease extension. Comparative homes in Dartmouth Park with an extended lease were worth £200,000. The average amount of ground rent was £50 collected quarterly. The lease termination date was on 16 August 2103. Given that there were 78 years left we calculated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 plus costs.
An example of a Lease Extension matter before the tribunal for a Dartmouth Park premises is Flat 2 27 Mackeson Road in December 2012. The Tribunal assessed the value of the lease extension premium at £35,435 and rounded the figure to £35,500 This case affected 1 flat. The unexpired residue of the current lease was 64.77 years.