The re-sale value of a leasehold property in Llanarth depends on how many years the lease has left to run. If it is near to or fewer than 80 years you should foresee difficulties on re-sale, so it is recommended to arrange for a lease extension prior to buying. It is preferable to start the process of extending the lease is when a lease still has 82 years unexpired so that formalities can be concluded ahead of the eighty year threshold. Statute entitles Llanarth qualifying lessees to obtain a lease extension of ninety years in addition to the remaining lease term at a peppercorn rent (that is, rent free). The reason of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a property with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 45 years left, the property will be worth the same as a freehold for many years ahead.
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Regardless of whether you are a tenant or a freeholder in Llanarth,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Llanarth valuers.
In the wake of 6 months of lengthy negotiations with the freeholder of her one bedroom apartment in Llanarth, Katie commenced the lease extension process just as the lease was coming close to the crucial 80-year mark. The transaction completed in September 2005. The freeholder’s fees were restricted to about 500 pounds.
In 2012 we were approached by Mr and Mrs. A Martínez who, having completed a newly refurbished flat in Llanarth in January 2007. The dilemma was if we could shed any light on how much (roughly) price would be for a 90 year lease extension. Similar residencies in Llanarth with a long lease were valued about £255,000. The average ground rent payable was £50 collected yearly. The lease finished on 16 August 2096. Taking into account 70 years as a residual term we calculated the premium to the landlord to extend the lease to be within £9,500 and £11,000 not including expenses.
Dr Charlotte Simon moved into a garden flat in Llanarth in February 2010. We are asked if we could estimate the compensation to the landlord would be for a ninety year lease extension. Comparable premises in Llanarth with 100 year plus lease were worth £246,800. The mid-range ground rent payable was £60 billed yearly. The lease ended in 2076. Having 50 years as a residual term we approximated the premium to the landlord to extend the lease to be within £44,700 and £51,600 exclusive of costs.