The value of Honiton leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can increase significantly once the unexpired lease term is less than eighty years
Leasehold properties in Honiton with more than one hundred years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Coventry Building Society | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
Retaining our service gives you increased control over the value of your Honiton leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Tommy owned a conversion flat in Honiton being marketed with a lease of fraction over 72 years remaining. Tommy on an informal basis spoke with his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a rise in the rent to £100 annually. Ordinarily, ground rent would not be due on a lease extension were Tommy to exercise his statutory right. Tommy procured expert legal guidance and secured satisfactory deal without going to tribunal and readily saleable.
Mr Logan Gray acquired a one bedroom apartment in Honiton in August 2010. The question was if we could shed any light on how much (approximately) price would likely be for a 90 year lease extension. Identical properties in Honiton with 100 year plus lease were in the region of £280,000. The mid-range ground rent payable was £45 invoiced monthly. The lease finished on 19 October 2096. Considering the 70 years left we calculated the premium to the freeholder to extend the lease to be between £12,400 and £14,200 not including professional charges.
In 2014 we were e-mailed by Mrs F Vincent who, having bought a one bedroom apartment in Honiton in January 1997. The question was if we could approximate the premium would likely be for a 90 year extension to my lease. Comparable flats in Honiton with an extended lease were in the region of £223,400. The mid-range ground rent payable was £60 invoiced per annum. The lease finished in 2085. Taking into account 59 years unexpired we estimated the compensation to the freeholder for the lease extension to be within £27,600 and £31,800 not including fees.