It’s an underpublicised truth that a Great Dunmow residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the first few years due to the reduction being disguised by increases in the Great Dunmow property market.Once your lease gets to 85ish years, you should start thinking about a lease extension. If lease term drops below 80 years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of leasehold owners in Great Dunmow will be able to extend under the legislation; however a conveyancer should be able to clarify whether you qualify for an extension. In some cases you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your lawyer from beginning to end of the process.
Leasehold properties in Great Dunmow with in excess of 100 years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges justify it.
| 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. |
| Halifax | 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with procure Great Dunmow 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 conveyancer we work with provide it.
Off the back of protracted correspondence with the freeholder of her purpose-built apartment in Great Dunmow, Sian started the lease extension process as the 80 year mark was rapidly advancing. The legal work was concluded in April 2005. The landlord’s charges were negotiated to about 500 pounds.
In 2010 we were approached by Ms Amy Murphy who, having purchased a studio apartment in Great Dunmow in February 2007. The question was if we could approximate the compensation to the landlord could be to extend the lease by an additional years. Comparable homes in Great Dunmow with 100 year plus lease were in the region of £275,000. The average ground rent payable was £55 invoiced annually. The lease expiry date was in 2103. Having 77 years unexpired we estimated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 exclusive of costs.
In 2009 we were contacted by Mr A Lee who, having was assigned a lease of a purpose-built flat in Great Dunmow in October 2007. The dilemma was if we could shed any light on how much (roughly) premium would be for a 90 year extension to my lease. Similar homes in Great Dunmow with a long lease were in the region of £183,600. The mid-range amount of ground rent was £65 billed every twelve months. The lease terminated on 20 May 2083. Given that there were 57 years unexpired we estimated the premium to the freeholder to extend the lease to be between £28,500 and £33,000 plus professional charges.