The value of Torpoint leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can increase significantly once the remaining term is less than 80 years
It is conventional wisdom that a property with more than one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with procure Torpoint 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.
Last October Caleb, came seriously near to the eighty-year mark with the lease on his one bedroom flat in Torpoint. Having purchased his home two decades ago, the length of the lease was of little relevance. Fortunately, he became aware that he would soon be paying way over the odds for a lease extension. Caleb was able to extend his lease just under the wire last August. Caleb and the freeholder via the management company eventually settled on sum of £5,500 . If the lease had descended below eighty years, the premium would have escalated by at least £1,025.
Mr and Mrs. V David purchased a first floor apartment in Torpoint in March 2001. The question was if we could shed any light on how much (approximately) price could be for a 90 year extension to my lease. Similar properties in Torpoint with an extended lease were worth £260,200. The mid-range amount of ground rent was £65 invoiced yearly. The lease came to a finish in 2092. Given that there were 66 years outstanding we calculated the premium to the freeholder to extend the lease to be within £15,200 and £17,600 exclusive of professional charges.
Last Christmas we were e-mailed by Mrs Madeleine Scott , who bought a ground floor apartment in Torpoint in June 2011. We are asked if we could estimate the compensation to the landlord would likely be for a ninety year lease extension. Comparable premises in Torpoint with a long lease were worth £198,800. The mid-range amount of ground rent was £55 collected per annum. The lease lapsed on 8 June 2081. Having 55 years outstanding we approximated the premium to the freeholder for the lease extension to be within £33,300 and £38,400 not including fees.