Unfortunately that a Deddington residential lease is a wasting 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 deflation being disguised by increases in the Deddington property prices.Once your lease gets to 85ish years, 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 80 years - otherwise a higher premium will be due. Most flat owners in Deddington will be able to extend under the legislation; however a conveyancer should be able to clarify if you are eligibility. In some cases you may not be entitled. There are also strict timeframes and procedures to follow once the process has commenced and you will need to be guided by your lawyer for the duration of the formalities.
Leasehold properties in Deddington with more than one hundred years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Chelsea 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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 lawyers that we work with handle Deddington 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 conveyancing solicitor we work with provide it.
Harvey was the the leasehold owner of a studio flat in Deddington being sold with a lease of a little over 72 years remaining. Harvey on an informal basis contacted his landlord a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent initially set at £200 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Harvey to invoke his statutory right. Harvey obtained expert advice and was able to make an informed judgement and deal with the matter and sell the flat.
Last Autumn we were approach by Mr and Mrs. E Lefèvre , who took over the lease of a studio flat in Deddington in September 2012. We are asked if we could estimate the compensation to the landlord would be for a ninety year extension to my lease. Identical flats in Deddington with 100 year plus lease were worth £254,200. The average ground rent payable was £60 invoiced yearly. The lease lapsed in 2076. Taking into account 51 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £43,700 and £50,600 not including expenses.
Last Spring we were called by Dr Isabel Thomas , who acquired a one bedroom apartment in Deddington in January 2002. The question was if we could approximate the price could be for a ninety year extension to my lease. Comparative premises in Deddington with an extended lease were in the region of £210,600. The mid-range amount of ground rent was £45 collected per annum. The lease ended in 2087. Taking into account 62 years as a residual term we approximated the premium to the freeholder for the lease extension to be between £18,100 and £20,800 plus expenses.