When it comes to long leasehold property in Deganwy, you are actually buying a right to live in a property for a set period of time. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you may think about a lease extension sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly especially once there are fewer than 80 years left. Anyone in Deganwy with a lease approaching 81 years unexpired should seriously think of extending it as soon as possible. Once a lease has under 80 years remaining, under the current Act the freeholder can calculate and levy a greater premium, based on a technical computation, strangely termed as “marriage value” which is payable.
Leasehold properties in Deganwy with over 100 years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
Using our service will provide you enhanced control over the value of your Deganwy leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In the wake of 9 months of lengthy negotiations with the freeholder of her garden flat in Deganwy, Kirsty started the lease extension process as the eighty year threshold was rapidly approaching. The lease extension completed in June 2014. The freeholder’s fees were restricted to approximately 700 GBP.
Mr Nathan Carter took over the lease of a newly refurbished apartment in Deganwy in April 2005. The question was if we could estimate the compensation to the landlord would be to extend the lease by a further 90 years. Identical residencies in Deganwy with 100 year plus lease were in the region of £233,200. The average amount of ground rent was £60 billed monthly. The lease ended on 3 March 2086. Having 61 years unexpired we calculated the compensation to the freeholder to extend the lease to be between £22,800 and £26,400 not including costs.
Dr Dylan Nguyen bought a one bedroom apartment in Deganwy in November 1998. The dilemma was if we could approximate the compensation to the landlord would likely be to extend the lease by an additional years. Identical flats in Deganwy with 100 year plus lease were valued around £171,800. The average amount of ground rent was £55 billed quarterly. The lease terminated in 2075. Having 50 years left we estimated the premium to the landlord for the lease extension to be within £32,300 and £37,400 plus costs.