The re-sale value of a leasehold property in Dorridge is impacted by how many years the lease has remaining. If it is near to or less than 80 years you should foresee difficulties on re-sale, so it is recommended to arrange for a lease extension ahead of purchasing. Ideally one should start the lease extension process when the lease still has 82 years to run so that a lease extension can be concluded ahead of the eighty year threshold. Statute entitles Dorridge qualifying lessees to an additional term of ninety years in addition to the unexpired term, at a notional rent (zero ground rent). The reason 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.
It is generally considered that a residential leasehold with more than one hundred years remaining is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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 |
Regardless of whether you are a tenant or a landlord in Dorridge,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Dorridge valuers.
16 months ago Tommy, came precariously near to the 80-year threshold with the lease on his first floor flat in Dorridge. Having bought his property two decades ago, the unexpired term was of little bearing. Luckily, it dawned on him that he needed to take steps soon on Extending the lease. Tommy arranged for a lease extension just ahead of time in September. Tommy and the landlord who owned the flat above in the end settled on a premium of £5,000 . If he not met the deadline, the price would have increased by a minimum £1,050.
Last Autumn we were approach by Ms Aimee Parker , who owned a studio apartment in Dorridge in September 2008. The question was if we could approximate the compensation to the landlord would likely be for a 90 year extension to my lease. Identical premises in Dorridge with 100 year plus lease were valued about £290,000. The average ground rent payable was £45 billed annually. The lease expiry date was on 22 April 2098. Considering the 72 years as a residual term we approximated the premium to the freeholder for the lease extension to be within £11,400 and £13,200 plus costs.
In 2009 we were approached by Mr and Mrs. V James who, having took over the lease of a one bedroom flat in Dorridge in March 1999. We are asked if we could approximate the premium could be for a 90 year extension to my lease. Identical residencies in Dorridge with 100 year plus lease were valued about £233,200. The mid-range amount of ground rent was £60 invoiced every twelve months. The lease ran out on 27 February 2087. Given that there were 61 years outstanding we approximated the compensation to the landlord to extend the lease to be between £22,800 and £26,400 not including fees.