The market value of a leasehold property in Plymouth is impacted by how many years the lease has remaining. If it is near to or fewer than eighty years you should envisage problems on re-sale, so it is recommended to arrange for a lease extension before purchasing. It is preferable to commence the process of extending the lease is when the lease still has 82 years remaining so that all matters can be addressed ahead of the 80 year mark. Leasehold Reform legislation enables Plymouth qualifying lessees to an additional term of ninety years on top of the existing term, at a peppercorn rent (zero ground rent). The intention of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, 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. |
| 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. |
| Coventry Building Society | 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a freeholder in Plymouth,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 Plymouth valuers.
Last Autumn Mason, came perilously near to the eighty-year threshold with the lease on his basement apartment in Plymouth. Having purchased his flat 19 years ago, the lease term was of minimal bearing. Luckily, he realised he would soon be paying way over the odds for a lease extension. Mason extended the lease just in the nick of time in September. Mason and the freeholder eventually agreed on the final figure of £6,000 . If he not met the deadline, the amount would have gone up by a minimum £1,100.
In 2010 we were e-mailed by Mr T Moreau who, having moved into a one bedroom flat in Plymouth in November 2001. We are asked if we could approximate the premium would be for a ninety year extension to my lease. Comparable flats in Plymouth with an extended lease were worth £208,600. The mid-range amount of ground rent was £60 billed quarterly. The lease elapsed on 19 November 2081. Having 57 years outstanding we approximated the premium to the freeholder for the lease extension to be within £30,400 and £35,200 plus legals.
In 2013 we were contacted by Dr K King who, having purchased a newly refurbished apartment in Plymouth in April 2012. The dilemma was if we could approximate the premium would be for a ninety year extension to my lease. Comparative homes in Plymouth with 100 year plus lease were in the region of £200,000. The average amount of ground rent was £50 invoiced every twelve months. The lease came to a finish on 6 May 2101. Taking into account 77 years left we calculated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 plus costs.