Torrington leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. The majority of owners of residential leasehold property in Torrington enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Torrington you would be well advised to investigate if your lease has between 70 and 90 years left. There are good reasons why a Torrington leaseholder with a lease having around 80 years remaining should take action to make sure that a lease extension is put in place without delay
It is generally accepted that a residential leasehold with more than 100 years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 35 years left, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| 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. |
Using our service will provide you enhanced control over the value of your Torrington leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In 2014 Seth, came precariously close to the 80-year threshold with the lease on his one bedroom flat in Torrington. Having purchased his home two decades ago, the unexpired term was of no interest. by good luck, he realised he would imminently be paying an escalated premium for a lease extension. Seth extended the lease just ahead of time last April. Seth and the landlord subsequently settled on an amount of £5,000 . If the lease had dipped to less than 80 years, the price would have become more exhorbitant by at least £900.
In 2010 we were called by Mrs A Morel who, having bought a recently refurbished flat in Torrington in March 1997. The dilemma was if we could estimate the compensation to the landlord would likely be to extend the lease by a further 90 years. Similar homes in Torrington with 100 year plus lease were in the region of £191,000. The average amount of ground rent was £65 billed monthly. The lease concluded in 2084. Given that there were 58 years as a residual term we approximated the premium to the landlord for the lease extension to be between £23,800 and £27,400 not including professional charges.
Dr Morgan Martin bought a basement flat in Torrington in April 1998. We are asked if we could approximate the price could be to extend the lease by a further 90 years. Comparable residencies in Torrington with an extended lease were in the region of £250,000. The average amount of ground rent was £50 billed annually. The lease expired on 3 April 2095. Considering the 69 years remaining we approximated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 exclusive of costs.