Great Dunmow leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease becomes more expensive. Legislation has been in place for sometime now which permits qualifying Great Dunmow residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Great Dunmow you would be well advised to see if your lease has between seventy and ninety years remaining. In particular once the remaining lease term slips under 80 years, the cost of any lease extension sharply increases as an element of the premium you will incur is what is known as a marriage value
Leasehold premises in Great Dunmow with in excess of 100 years remaining on the lease are often regarded as a ‘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 buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| 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 |
Lease extensions in Great Dunmow can be a difficult process. We recommend you procure professional help from a conveyancer and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Great Dunmow lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Felix was the the leasehold owner of a high value apartment in Great Dunmow being marketed with a lease of a few days over 61 years remaining. Felix informally spoke with his freeholder a well known London-based freehold company for a lease extension. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £125 annually. Ordinarily, ground rent would not be due on a lease extension were Felix to invoke his statutory right. Felix obtained expert advice and was able to make a more informed judgement and deal with the matter and sell the property.
In 2013 we were called by Dr Isabelle Flores who, having took over the lease of a one bedroom flat in Great Dunmow in February 1998. The dilemma was if we could approximate the premium would be to prolong the lease by a further 90 years. Comparable flats in Great Dunmow with an extended lease were in the region of £176,200. The average amount of ground rent was £65 billed yearly. The lease elapsed on 28 September 2081. Considering the 56 years left we calculated the premium to the freeholder to extend the lease to be between £29,500 and £34,000 not including legals.
Ms J Green took over the lease of a purpose-built apartment in Great Dunmow in August 1995. We are asked if we could shed any light on how much (roughly) premium would be for a 90 year lease extension. Comparative flats in Great Dunmow with an extended lease were worth £242,600. The average amount of ground rent was £45 invoiced every twelve months. The lease ran out on 10 November 2092. Considering the 67 years remaining we approximated the compensation to the freeholder to extend the lease to be between £11,400 and £13,200 not including expenses.