With a domestic leasehold premises in Tavistock, you are in fact renting it for a certain amount of time. In recent years flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you may think about a lease extension sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately greater particularly when there are less than eighty years left. Residents in Tavistock with a lease approaching 81 years unexpired should seriously consider extending it sooner rather than later. When a lease has under eighty years remaining, under the current statute the freeholder is entitled to calculate and charge a larger premium, based on a technical multiplication, known as “marriage value” which is due.
It is generally considered that a property with in excess of one hundred years remaining is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 35 years left, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with procure Tavistock 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 conveyancer we work with provide it.
Subsequent to unsuccessful correspondence with the landlord of her purpose-built flat in Tavistock, Chloe initiated the lease extension process as the eighty year threshold was swiftly nearing. The lease extension completed in March 2008. The landlord’s fees were kept to an absolute minimum.
In 2013 we were phoned by Mr and Mrs. J Lambert who, having acquired a ground floor apartment in Tavistock in August 1995. We are asked if we could shed any light on how much (approximately) price could be for a 90 year lease extension. Similar properties in Tavistock with a long lease were worth £183,600. The average amount of ground rent was £65 invoiced per annum. The lease concluded on 4 January 2081. Considering the 57 years unexpired we calculated the premium to the landlord to extend the lease to be within £28,500 and £33,000 exclusive of fees.
Dr Tyler Parker purchased a garden flat in Tavistock in October 2009. We are asked if we could estimate the price would be for a 90 year lease extension. Similar premises in Tavistock with 100 year plus lease were valued about £250,000. The mid-range amount of ground rent was £50 invoiced every twelve months. The lease concluded in 2092. Taking into account 68 years unexpired we calculated the premium to the landlord for the lease extension to be within £9,500 and £11,000 not including legals.