With a long leasehold premises in Borth, you are in fact renting it for a certain period of time. These days flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you may consider extending the lease sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly notably once there are fewer than 80 years remaining. Residents in Borth with a lease nearing 81 years left should seriously consider extending it sooner than later. Once the lease term has fewer than eighty years left, under the relevant statute the landlord is entitled to calculate and demand a larger premium, assessed on a technical calculation, known as “marriage value” which is due.
It is generally considered that a property with more than one hundred years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years unexpired, the property 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
The conveyancers that we work with handle Borth 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 conveyancing solicitor we work with provide it.
In 2014 Connor, came critically close to the eighty-year mark with the lease on his studio apartment in Borth. In buying his flat 19 years previously, the length of the lease was of no interest. As luck would have it, he recognised he would imminently be paying an escalated premium for a lease extension. Connor arranged for a lease extension at the eleventh hour last January. Connor and the landlord subsequently settled on sum of £5,500 . If he not met the deadline, the figure would have become more exhorbitant by at least £1,000.
Last month we were called by Mr and Mrs. U Ramírez , who acquired a garden apartment in Borth in November 2007. The question was if we could estimate the price could be to extend the lease by 90 years. Comparative flats in Borth with an extended lease were in the region of £280,000. The average amount of ground rent was £55 billed yearly. The lease finished in 2105. Given that there were 79 years remaining we estimated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 plus legals.
In 2009 we were contacted by Mr and Mrs. W Young who, having moved into a studio flat in Borth in February 2009. We are asked if we could approximate the compensation to the landlord would be to prolong the lease by ninety years. Identical homes in Borth with a long lease were worth £191,000. The average ground rent payable was £65 invoiced every twelve months. The lease terminated in 2084. Considering the 58 years outstanding we approximated the compensation to the freeholder to extend the lease to be within £23,800 and £27,400 plus fees.