For anyone whose Grangetown flat is held on a long lease, our message is clear – if you do nothing, the property will eventually revert to the freeholder, leaving you empty-handed. The shorter the lease the less it is worth and the more expensive it will be to extend the lease.
Leasehold premises in Grangetown with more than one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
| 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 conveyancing solicitors that we work with handle Grangetown 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.
Last Winter Harvey, started to get close to the eighty-year threshold with the lease on his studio flat in Grangetown. In buying his home two decades ago, the lease term was of no bearing. Fortunately, he recognised he needed to take steps soon on Extending the lease. Harvey was able to extend his lease just ahead of time last June. Harvey and the landlord who owned the flat above subsequently settled on sum of £6,000 . If he not met the deadline, the amount would have escalated by a minimum £1,075.
Last Autumn we were phoned by Mrs Isabel Flores , who completed a purpose-built apartment in Grangetown in August 1997. We are asked if we could shed any light on how much (roughly) price would likely be for a ninety year extension to my lease. Comparative residencies in Grangetown with 100 year plus lease were worth £200,000. The average ground rent payable was £50 invoiced every twelve months. The lease elapsed in 2103. Considering the 78 years unexpired we approximated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 not including professional charges.
In 2012 we were called by Mr and Mrs. B Davies who, having acquired a first floor flat in Grangetown in March 2011. We are asked if we could estimate the compensation to the landlord would be for a ninety year lease extension. Comparable homes in Grangetown with an extended lease were valued about £267,600. The average amount of ground rent was £65 collected every twelve months. The lease came to a finish in 2092. Considering the 67 years as a residual term we calculated the compensation to the landlord for the lease extension to be within £14,300 and £16,400 exclusive of professional charges.