Plymstock 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 becomes more expensive. It is the case that most Plymstock tenants have the right to extend their lease by an additional 90 years under the 1993 Leasehold Reform Act. Where you are a leasehold owner in Plymstock you really ought to check if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under 80 years, the compensation to the landlord for any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
Leasehold residencies in Plymstock with more than 100 years outstanding on the lease are sometimes 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 upside in purchasing the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 |
Regardless of whether you are a tenant or a freeholder in Plymstock,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Plymstock valuers.
After unsuccessful discussions with the freeholder of her leasehold apartment in Plymstock, Katie initiated the lease extension process as the 80 year deadline was rapidly approaching. The lease extension completed in September 2013. The freeholder’s costs were negotiated to about 600 GBP.
In 2014 we were e-mailed by Dr F Mitchell who, having acquired a one bedroom flat in Plymstock in June 2011. We are asked if we could approximate the premium would be to prolong the lease by ninety years. Comparable flats in Plymstock with a long lease were valued about £243,000. The average amount of ground rent was £65 billed monthly. The lease terminated in 2088. Having 63 years outstanding we estimated the premium to the freeholder to extend the lease to be within £20,000 and £23,000 exclusive of costs.
In 2010 we were e-mailed by Mr Max Morris who, having completed a purpose-built apartment in Plymstock in July 2010. The question was if we could approximate the compensation to the landlord would be to extend the lease by ninety years. Comparative homes in Plymstock with 100 year plus lease were in the region of £181,600. The average amount of ground rent was £55 invoiced yearly. The lease concluded on 12 November 2077. Given that there were 52 years remaining we approximated the premium to the freeholder to extend the lease to be between £30,400 and £35,200 exclusive of fees.