Plymouth leases on residential properties are gradually diminishing 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. It is the case that most Plymouth tenants have the right to extend their lease by an additional 90 years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in Plymouth you would be well advised to see if your lease has between seventy and ninety years left. There are compelling reasons why a Plymouth flat owner with a lease having around eighty years remaining should take action to ensure that a lease extension is put in place without delay
Leasehold properties in Plymouth with over 100 years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Lease extensions in Plymouth can be a difficult process. We recommend you procure guidance from a conveyancer and valuer with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring Plymouth lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In 2014 Max, came very close to the 80-year threshold with the lease on his purpose- built apartment in Plymouth. Having purchased his property twenty years ago, the lease term was of little relevance. As luck would have it, he recognised he would imminently be paying an inflated amount for Extending the lease. Max extended the lease just under the wire last May. Max and the landlord eventually agreed on a premium of £6,000 . If the lease had fallen below 80 years, the premium would have escalated by a minimum £1,000.
Last year we were approach by Mr and Mrs. M Richardson , who purchased a purpose-built flat in Plymouth in May 1998. We are asked if we could estimate the price could be for a 90 year extension to my lease. Identical properties in Plymouth with an extended lease were valued about £205,000. The mid-range ground rent payable was £50 invoiced monthly. The lease terminated on 14 November 2104. Considering the 79 years remaining we calculated the compensation to the landlord to extend the lease to be between £7,600 and £8,800 not including professional charges.
Last Summer we were approach by Ms Jodie King , who bought a ground floor apartment in Plymouth in November 1998. The question was if we could shed any light on how much (roughly) compensation to the landlord would be to prolong the lease by 90 years. Comparative residencies in Plymouth with an extended lease were valued around £275,000. The mid-range ground rent payable was £65 billed per annum. The lease finished in 2093. Taking into account 68 years outstanding we approximated the compensation to the freeholder to extend the lease to be within £12,400 and £14,200 plus fees.