It’s an underpublicised certainty that a Torrington residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the early years due to the depreciation being disguised by increases in the Torrington property market.Once your lease nears 85ish years, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips under 80 years - otherwise a higher amount will be due. The majority of flat owners in Torrington will be able to extend under the legislation; however a conveyancer will be able to confirm whether you are eligibility. In some situations you may not qualify. There are also strict timetables and procedures to follow once the process is initiated and you will need to be guided by your lawyer for the duration of the formalities.
Leasehold premises in Torrington with more than one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges justify it.
| 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. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a freeholder in Torrington,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Torrington valuers.
Kai owned a studio flat in Torrington on the market with a lease of a few days over 59 years outstanding. Kai on an informal basis approached his freeholder being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent at the outset set at £150 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Kai to invoke his statutory right. Kai procured expert advice and secured satisfactory resolution without resorting to tribunal and ending up with a market value flat.
In 2012 we were called by Dr N Gunderson who, having took over the lease of a one bedroom apartment in Torrington in November 2007. We are asked if we could estimate the compensation to the landlord would be for a ninety year lease extension. Identical flats in Torrington with 100 year plus lease were in the region of £264,000. The average amount of ground rent was £60 invoiced yearly. The lease termination date was in 2079. Considering the 53 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £37,100 and £42,800 not including fees.
Last Christmas we were phoned by Mr and Mrs. H Robinson , who moved into a one bedroom apartment in Torrington in September 2004. We are asked if we could shed any light on how much (approximately) premium would likely be to extend the lease by 90 years. Similar properties in Torrington with 100 year plus lease were valued around £225,400. The average amount of ground rent was £45 collected per annum. The lease lapsed in 2090. Considering the 64 years unexpired we approximated the premium to the freeholder to extend the lease to be within £15,200 and £17,600 not including legals.