Why you should commence your Salcombe lease extension

Main reasons to start your Salcombe lease extension today:

A Salcombe lease depreciates with the years remaining on the lease.

The market value of a leasehold property in Salcombe is impacted by how many years the lease has left to run. If it is close to or fewer than 80 years you should envisage difficulties on re-sale, so it is advisable to arrange for the lease to be extended prior to buying. It is ideal to start the lease extension process when a lease still has 82 years remaining so that a lease extension can be concluded in advance of the 80 year mark. Current legislation entitles Salcombe qualifying lessees to obtain a lease extension of ninety years in addition to the remaining lease term at a peppercorn rent (that is, rent free). The purpose of the valuation is to determine the premium payable by the lessee to the freeholder for the acquisition of the lease extension.

Salcombe property with a lease extension has roughly the same value as a freehold

Leasehold premises in Salcombe with more than 100 years unexpired on the lease are often referred to as ‘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 service charges warrant it.

Banks and Building Societies may not lend with a short lease

The propensity since the credit crunch has been for banks to tighten lending requirements generally - this has extended to the types of security over which the home loan is to be charged. This has meant the unexpired lease term required by lenders has increased. In the past lenders were content with 25 years plus the term of the loan - typically fifty year leases but those requirements have been chipped away by the requirement for longer and longer leases - many use a minimum term of 75 years as standard.

Get in touch with one of our Salcombe lease extension solicitors or enfranchisement solicitors

Using our service will provide you enhanced control over the value of your Salcombe leasehold, as your property will be more valuable and saleable in respect of lease length should you wish 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.

Salcombe Lease Extension Example Cases:

Lucy, Salcombe, Devon,

Following lengthy correspondence with the landlord of her one bedroom flat in Salcombe, Lucy commenced the lease extension process as the eighty year mark was swiftly coming. The transaction was finalised in October 2015. The freeholder’s charges were restricted to below 700 pounds.

Salcombe case:

In 2014 we were e-mailed by Ms N Garcia who, having moved into a first floor apartment in Salcombe in January 2007. We are asked if we could approximate the premium would likely be for a 90 year extension to my lease. Comparative homes in Salcombe with an extended lease were in the region of £225,400. The average amount of ground rent was £45 billed every twelve months. The lease elapsed in 2090. Taking into account 64 years left we approximated the premium to the freeholder for the lease extension to be within £15,200 and £17,600 plus fees.

Salcombe case:

Last year we were contacted by Mrs H Moore , who took over the lease of a purpose-built flat in Salcombe in May 2006. The dilemma was if we could estimate the price would be to prolong the lease by 90 years. Comparative homes in Salcombe with 100 year plus lease were valued around £270,000. The mid-range ground rent payable was £55 billed per annum. The lease termination date was in 2101. Having 75 years unexpired we approximated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 exclusive of fees.