Taunton leases on residential properties are gradually losing value. Where your lease has in the region of ninety years left, you should start considering the need for a lease extension. 80 years is a significant number: when the remaining term of a lease drops below this level then you start incurring an additional element called marriage value. Leasehold owners in Taunton will usually qualify for a lease extension; however a solicitor should be able confirm your eligibility. In certain cases you may not qualify. There are prescribed deadlines and formalities to follow once the process has commenced so it’s wise to be guided by a conveyancer during the process.
Leasehold residencies in Taunton with in excess of 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and service 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; |
| 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. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a landlord in Taunton,the lease extension lawyers 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 Taunton valuers.
Austin owned a conversion flat in Taunton being sold with a lease of fraction over 72 years remaining. Austin informally contacted his freeholder a well known Bristol-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 subject to a rise in the rent to £200 annually. Ordinarily, ground rent would not be due on a lease extension were Austin to invoke his statutory right. Austin obtained expert legal guidance and was able to make an informed judgement and deal with the matter and readily saleable.
Mr and Mrs. M Smith bought a garden flat in Taunton in August 2003. We are asked if we could shed any light on how much (roughly) price could be for a ninety year lease extension. Comparative homes in Taunton with an extended lease were valued around £216,000. The mid-range ground rent payable was £60 billed yearly. The lease ended in 2083. Given that there were 58 years left we calculated the compensation to the freeholder to extend the lease to be between £28,500 and £33,000 not including legals.
Last Autumn we were phoned by Dr Freddie Fournier , who purchased a basement apartment in Taunton in March 2010. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be to prolong the lease by 90 years. Identical properties in Taunton with a long lease were valued about £200,000. The average amount of ground rent was £50 invoiced monthly. The lease expired in 2103. Considering the 78 years unexpired we calculated the premium to the landlord for the lease extension to be between £8,600 and £9,800 not including professional charges.