With a long leasehold premises in Aberystwyth, you are actually buying a right to reside in a property for a prescribed time frame. These days flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you should consider a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease gets disproportionately more expensive especially when there are less than eighty years left. Anyone in Aberystwyth with a lease drawing near to 81 years left should seriously think of extending it sooner as opposed to later. When the lease term has fewer than 80 years remaining, under the current Act the landlord is entitled to calculate and demand a greater premium, based on a technical computation, known as “marriage value” which is due.
Leasehold properties in Aberystwyth with more than one hundred years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
The conveyancing solicitors that we work with handle Aberystwyth 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 lawyer we work with provide it.
After lengthy correspondence with the landlord of her leasehold flat in Aberystwyth, Sophie commenced the lease extension process as the eighty year mark was rapidly nearing. The legal work was concluded in July 2009. The freeholder’s costs were negotiated to a tad over 450 GBP.
Mrs Isabel Martinez completed a basement flat in Aberystwyth in March 2010. We are asked if we could estimate the compensation to the landlord would be for a ninety year lease extension. Comparative properties in Aberystwyth with an extended lease were valued around £208,600. The mid-range amount of ground rent was £60 collected annually. The lease concluded on 15 March 2083. Given that there were 57 years left we approximated the premium to the landlord for the lease extension to be within £30,400 and £35,200 not including legals.
Mr and Mrs. G Brooks was assigned a lease of a studio apartment in Aberystwyth in February 2008. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to extend the lease by an additional years. Identical homes in Aberystwyth with a long lease were worth £200,000. The mid-range ground rent payable was £50 collected quarterly. The lease concluded in 2103. Considering the 77 years remaining we estimated the premium to the freeholder to extend the lease to be between £8,600 and £9,800 plus expenses.