The market value of a leasehold property in Dinnington is impacted by how many years the lease has remaining. If it is near to or less than 80 years you should expect difficulties on re-sale, so it is advisable to arrange for a lease extension before buying. It is preferable to start the process of extending the lease is when the lease still has 82 years to run so that formalities can be concluded in advance of the eighty year cut off point. Statute enables Dinnington qualifying lessees to obtain a lease extension of ninety years in addition to the remaining lease term at a peppercorn rent (that is, rent free). The intention of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a property with in excess of 100 years remaining is worth approximately the equivalent as a freehold. Where an additional ninety 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with undertake Dinnington 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.
Liam owned a 2 bedroom apartment in Dinnington on the market with a lease of a little over 72 years remaining. Liam on an informal basis spoke with his landlord being a well known Bristol-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 an increased rent to £200 per annum. Ordinarily, ground rent would not be due on a lease extension were Liam to invoke his statutory right. Liam obtained expert legal guidance and secured satisfactory deal informally and ending up with a market value flat.
Last Spring we were e-mailed by Ms Millie Harris , who completed a first floor apartment in Dinnington in March 1997. We are asked if we could estimate the compensation to the landlord could be for a 90 year extension to my lease. Comparative homes in Dinnington with a long lease were valued around £174,200. The average ground rent payable was £55 billed monthly. The lease finished in 2077. Considering the 51 years remaining we calculated the compensation to the landlord for the lease extension to be within £31,400 and £36,200 plus professional charges.
In 2011 we were called by Ms G Leroy who, having purchased a one bedroom apartment in Dinnington in March 2002. We are asked if we could shed any light on how much (approximately) price would be for a ninety year extension to my lease. Comparative properties in Dinnington with a long lease were valued around £285,000. The average ground rent payable was £45 billed per annum. The lease expiry date was on 17 September 2097. Taking into account 71 years outstanding we estimated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 not including expenses.