Montacute leases on residential properties are gradually losing value. Where your lease has in the region of ninety years unexpired, you should start thinking about a lease extension. It is important to recognise that it is that it is financially advisable for a lease extension to be in place before the term of the current lease drops under 80 years - otherwise a higher premium will be payable. Flat owners in Montacute will mostly be legally entitled to a lease extension; however a solicitor will confirm if you qualify. In some circumstances you may not qualify. There are prescribed timetables and steps to comply with once the process has started so it’s prudent to be guided by a conveyancer during the process.
Leasehold premises in Montacute with more than one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| 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. |
| 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. |
| 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. |
Retaining our service will provide you enhanced control over the value of your Montacute leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Half a year ago Alex, came critically close to the 80-year threshold with the lease on his purpose- built apartment in Montacute. In buying his flat two decades ago, the length of the lease was of no significance. Fortunately, he recognised he would imminently be paying an escalated premium for a lease extension. Alex was able to extend his lease at the eleventh hour in May. Alex and the landlord who owned the flat above in the end settled on sum of £5,000 . If the lease had slid below eighty years, the amount would have gone up by a minimum £1,075.
Last Spring we were approach by Mr and Mrs. G Thompson , who moved into a purpose-built flat in Montacute in June 2004. The dilemma was if we could shed any light on how much (approximately) price would be to prolong the lease by 90 years. Comparable flats in Montacute with an extended lease were worth £189,000. The mid-range amount of ground rent was £55 billed monthly. The lease lapsed on 1 March 2079. Taking into account 53 years as a residual term we approximated the premium to the landlord to extend the lease to be within £28,500 and £33,000 exclusive of costs.
Last Autumn we were called by Dr J Rogers , who bought a first floor apartment in Montacute in March 2002. We are asked if we could estimate the premium would be for a 90 year extension to my lease. Comparable properties in Montacute with 100 year plus lease were in the region of £290,000. The average ground rent payable was £45 billed quarterly. The lease finished in 2099. Having 73 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 not including expenses.