Dewsbury leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Dewsbury residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Dewsbury you really ought to check if your lease has between 70 and 90 years remaining. In particular once the remaining lease term slips under 80 years, the cost of any lease extension increases dramatically as part of the premium you will incur is what is known as a marriage value
Leasehold residencies in Dewsbury with over 100 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 situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset 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 |
Engaging our service will provide you enhanced control over the value of your Dewsbury leasehold, as your property will be more valuable and saleable in respect of lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
16 months ago Muhammad, came dangerously near to the eighty-year threshold with the lease on his leasehold flat in Dewsbury. In buying his property two decades ago, the lease term was of little bearing. Thankfully, he recognised he would soon be paying an escalated premium for Extending the lease. Muhammad extended the lease at the eleventh hour last April. Muhammad and the landlord who owned the flat above subsequently settled on the final figure of £6,000 . If the lease had slipped below eighty years, the price would have gone up by a minimum £900.
In 2009 we were contacted by Mr Caleb Parker who, having moved into a basement apartment in Dewsbury in February 2012. We are asked if we could approximate the price could be for a ninety year lease extension. Identical premises in Dewsbury with an extended lease were valued around £245,000. The average ground rent payable was £50 billed annually. The lease lapsed in 2093. Considering the 68 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 not including professional charges.
Last year we were approach by Mrs Bethan Mitchell , who owned a first floor flat in Dewsbury in August 2012. We are asked if we could estimate the premium could be to prolong the lease by 90 years. Similar residencies in Dewsbury with a long lease were in the region of £285,000. The mid-range amount of ground rent was £55 billed yearly. The lease came to a finish in 2104. Taking into account 79 years outstanding we estimated the premium to the freeholder to extend the lease to be within £13,300 and £15,400 exclusive of costs.