Llanarth residential property held on a long lease is a depreciating asset because a leaseholder only owns the property for a period of years.
Leasehold properties in Llanarth with more than one hundred years left 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 to be gained by purchasing the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 conveyancing solicitors that we work with handle Llanarth 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.
Luke owned a conversion flat in Llanarth being marketed with a lease of just over fifty eight years left. Luke informally approached his landlord a well known Bristol-based freehold company for a lease extension. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £100 annually. Ordinarily, ground rent would not be payable on a lease extension were Luke to invoke his statutory right. Luke procured expert advice and secured an acceptable deal informally and ending up with a market value flat.
Last Autumn we were contacted by Mr and Mrs. T Lefèvre , who acquired a first floor flat in Llanarth in March 2001. The dilemma was if we could approximate the compensation to the landlord would likely be for a ninety year lease extension. Similar properties in Llanarth with a long lease were in the region of £280,000. The average amount of ground rent was £55 collected every twelve months. The lease concluded in 2104. Given that there were 78 years remaining we estimated the compensation to the freeholder to extend the lease to be within £13,300 and £15,400 plus costs.
Mr and Mrs. P Richardson acquired a studio apartment in Llanarth in August 2003. We are asked if we could approximate the price could be to extend the lease by a further 90 years. Identical properties in Llanarth with 100 year plus lease were valued around £191,000. The mid-range ground rent payable was £65 billed annually. The lease came to a finish on 27 March 2084. Taking into account 58 years left we calculated the premium to the freeholder for the lease extension to be within £23,800 and £27,400 plus professional charges.