With a residential leasehold premises in Dolwyddelan, you are actually purchasing a right to reside in a property for a prescribed time frame. 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 consider a lease extension sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease increases markedly particularly when there are fewer than 80 years remaining. Anyone in Dolwyddelan with a lease approaching 81 years left should seriously think of extending it sooner rather than later. Once the lease term has fewer than 80 years remaining, under the relevant statute the freeholder is entitled to calculate and charge a larger premium, assessed on a technical calculation, known as “marriage value” which is due.
It is generally accepted that a property with more than one hundred years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 30 years unexpired, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with handle Dolwyddelan 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.
Zachary owned a studio flat in Dolwyddelan on the market with a lease of a little over 59 years left. Zachary informally spoke with his landlord being a well known London-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent initially set at £100 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Zachary to exercise his statutory right. Zachary obtained expert advice and secured satisfactory deal without going to tribunal and readily saleable.
In 2012 we were called by Mr Rory Hernández who, having was assigned a lease of a ground floor flat in Dolwyddelan in January 2012. The question was if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Identical properties in Dolwyddelan with a long lease were valued about £225,800. The mid-range amount of ground rent was £60 invoiced yearly. The lease lapsed on 26 February 2085. Given that there were 60 years as a residual term we calculated the premium to the landlord for the lease extension to be between £24,700 and £28,600 plus legals.
Last Christmas we were e-mailed by Dr Y Campbell , who bought a studio flat in Dolwyddelan in September 2012. The question was if we could approximate the premium would be to prolong the lease by a further 90 years. Similar properties in Dolwyddelan with an extended lease were worth £210,000. The mid-range amount of ground rent was £50 billed yearly. The lease expired in 2105. Taking into account 80 years left we estimated the compensation to the landlord to extend the lease to be within £8,600 and £9,800 plus professional charges.