The market value of a leasehold property in Merriott is impacted by how many years the lease has remaining. If it is near to or less than 80 years you should anticipate difficulties on re-sale, so it is advisable to arrange for a lease extension ahead of buying. It is ideal to start the process of extending the lease is when the lease still has 82 years to run so that a lease extension can be concluded ahead of the 80 year threshold. Current legislation entitles Merriott qualifying lessees to an additional term of 90 years in addition to the unexpired term, at a notional rent (zero ground rent). The purpose 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 accepted that a residential leasehold with more than 100 years remaining is worth approximately the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service gives you enhanced control over the value of your Merriott leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to protracted discussions with the freeholder of her one bedroom apartment in Merriott, Phoebe initiated the lease extension process just as her lease was approaching the all-important 80-year threshold. The legal work was finalised in July 2008. The freeholder’s fees were kept to an absolute minimum.
Mr U Cook moved into a garden apartment in Merriott in June 2010. We are asked if we could estimate the premium would be for a ninety year lease extension. Identical premises in Merriott with an extended lease were valued around £250,000. The average amount of ground rent was £50 invoiced monthly. The lease terminated in 2095. Taking into account 70 years remaining we approximated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 exclusive of fees.
Last Christmas we were called by Mr and Mrs. C Flores , who completed a first floor apartment in Merriott in July 1998. We are asked if we could approximate the price would likely be for a ninety year extension to my lease. Comparative flats in Merriott with a long lease were valued around £246,800. The average amount of ground rent was £60 invoiced per annum. The lease ended on 23 January 2075. Given that there were 50 years unexpired we calculated the compensation to the freeholder to extend the lease to be within £44,700 and £51,600 exclusive of costs.