Ilfracombe leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Ilfracombe residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Ilfracombe you must investigate if your lease has between 70 and 90 years remaining. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension sharply increases as part of the premium you pay is what is known as a marriage value
It is conventional wisdom that a property with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 30 years remaining, the property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Godiva Mortgages | 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a freeholder in Ilfracombe,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Ilfracombe valuers.
Last year Logan, came critically near to the eighty-year mark with the lease on his one bedroom flat in Ilfracombe. Having purchased his property two decades ago, the unexpired term was of little concern. Luckily, it dawned on him that he would soon be paying an inflated amount for a lease extension. Logan was able to extend his lease at the eleventh hour last August. Logan and the freeholder in the end settled on an amount of £5,500 . If the lease had gone lower than 80 years, the premium would have gone up by at least £1,150.
Last Spring we were approach by Ms I Sharif , who owned a studio flat in Ilfracombe in January 2000. The dilemma was if we could shed any light on how much (roughly) price would likely be to extend the lease by ninety years. Comparable premises in Ilfracombe with 100 year plus lease were valued around £290,000. The mid-range ground rent payable was £45 invoiced annually. The lease came to a finish on 20 April 2099. Given that there were 73 years left we approximated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 plus legals.
Mr E Thompson bought a first floor flat in Ilfracombe in July 1999. The dilemma was if we could approximate the premium could be for a ninety year lease extension. Similar flats in Ilfracombe with an extended lease were valued about £240,600. The mid-range ground rent payable was £65 invoiced monthly. The lease terminated on 1 October 2088. Given that there were 62 years outstanding we approximated the compensation to the landlord to extend the lease to be within £21,900 and £25,200 plus legals.