Why you should commence your Dartmouth lease extension

Top reasons for lease extension now:

A Dartmouth leasehold property depreciates with the years remaining on the lease.

The market value of a leasehold property in Dartmouth is impacted by how long the lease has remaining. If it is close to or less than eighty years you should expect problems on re-sale, so it is advisable to arrange for the lease to be extended before purchasing. Ideally one should start the process of extending the lease is when a lease still has 82 years to run so that a lease extension can be finalised prior to the 80 year mark. Current legislation entitles Dartmouth qualifying lessees to acquire a lease extension of 90 years in addition to the remaining length of the lease at a peppercorn rent (that is, rent free). The intention of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the purchase of the lease extension.

An extended lease has roughly the same value as a freehold

Leasehold premises in Dartmouth with more than one hundred years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and estate charges warrant it.

Lending institutions will not lend on a short lease

Banks and building societies are really restricting their approach as regards to homes in Dartmouth with short leases. For example you might discover that their lending requirements are stricter and that they alter interest rates depending on how many years are left on the lease. Some may even refuse to lend completely, so if you needed to sell, your only options would be to find a cash purchaser, or hope for the best at auction thus reducing the amount of prospective buyers.

Get in touch with one of our Dartmouth lease extension solicitors or enfranchisement solicitors

Irrespective of whether you are a tenant or a freeholder in Dartmouth,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Dartmouth valuers.

Dartmouth Lease Extension Case Summaries:

Liam, Dartmouth, Devon

Half a year ago Liam, started to get near to the 80-year mark with the lease on his studio apartment in Dartmouth. Having bought his home 18 years previously, the length of the lease was of no significance. Luckily, he noticed he would imminently be paying an inflated amount for Extending the lease. Liam extended the lease just under the wire last July. Liam and the landlord who owned the flat above subsequently settled on a premium of £5,500 . If he failed to meet the deadline, the amount would have increased by a minimum £1,025.

Dartmouth case:

Last Summer we were approach by Dr Holly Kelly , who completed a first floor apartment in Dartmouth in January 2000. We are asked if we could shed any light on how much (approximately) premium would be to prolong the lease by 90 years. Identical flats in Dartmouth with 100 year plus lease were in the region of £295,000. The mid-range amount of ground rent was £50 invoiced quarterly. The lease ended in 2101. Given that there were 75 years unexpired we calculated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 plus expenses.

Dartmouth case:

Last February we were contacted by Mr and Mrs. B Cox , who was assigned a lease of a garden apartment in Dartmouth in May 1999. The dilemma was if we could approximate the price could be for a 90 year lease extension. Similar residencies in Dartmouth with an extended lease were in the region of £250,400. The average amount of ground rent was £65 collected monthly. The lease elapsed in 2090. Having 64 years outstanding we estimated the compensation to the freeholder to extend the lease to be between £19,000 and £22,000 exclusive of fees.