Why you should start your Ottery St Mary lease extension

Why you should commence your Ottery St Mary lease extension today:

A Ottery St Mary lease depreciates with the years remaining on the lease.

Ottery St Mary leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. Most owners of residential leasehold property in Ottery St Mary enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Ottery St Mary you should see if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under eighty years, the compensation to the landlord for any lease extension increases dramatically as part of the premium you pay is what is known as a marriage value

Ottery St Mary property with a lease extension has roughly the same value as a freehold

Leasehold residencies in Ottery St Mary 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 property. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and estate charges warrant it.

Banks and Building Societies may not lend on a short lease

The trend since the credit crunch has been for lenders to tighten lending criteria generally - this has extended to the property over which the home loan is to be charged. This has meant the minimum number of years remaining under the lease required by mortgage companies has increased. Historically banks would grant a mortgage on a lease with twenty years plus the term of the loan - routinely fifty year leases but those requirements are being increasingly undermined by the requirement for longer and longer leases - many now have a minimum term of 75 years as standard.

Get in touch with one of our Ottery St Mary lease extension solicitors or enfranchisement solicitors

The lawyers that we work with undertake Ottery St Mary 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 conveyancing solicitor we work with provide it.

Ottery St Mary Lease Extension Case Summaries:

David, Ottery St Mary, Devon,

David owned a high value apartment in Ottery St Mary being marketed with a lease of a few days over 61 years left. David on an informal basis approached his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £200 yearly. Ordinarily, ground rent would not be payable on a lease extension were David to exercise his statutory right. David obtained expert advice and secured satisfactory resolution without resorting to tribunal and ending up with a market value flat.

Ottery St Mary case:

Last Christmas we were approach by Mr P Cooper , who purchased a one bedroom flat in Ottery St Mary in June 2007. The dilemma was if we could approximate the compensation to the landlord could be to prolong the lease by an additional years. Comparable homes in Ottery St Mary with 100 year plus lease were in the region of £265,000. The average amount of ground rent was £55 billed per annum. The lease ended in 2100. Having 74 years as a residual term we calculated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of fees.

Ottery St Mary case:

Mr and Mrs. N Green owned a one bedroom apartment in Ottery St Mary in January 1997. We are asked if we could estimate the premium would be to extend the lease by an additional years. Identical properties in Ottery St Mary with a long lease were in the region of £166,400. The average ground rent payable was £60 billed per annum. The lease ended in 2080. Given that there were 54 years outstanding we approximated the premium to the landlord to extend the lease to be between £32,300 and £37,400 not including fees.