Llandaff leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease becomes more expensive. It is the case that most Llandaff tenants have the right to extend their lease by an additional 90 years by virtue of the 1993 Leasehold Reform Act. Where you are a leasehold owner in Llandaff you must see if your lease has between 70 and 90 years remaining. There are compelling reasons why a Llandaff flat owner with a lease having around eighty years left should take steps to make sure that a lease extension is effected without delay
It is conventional wisdom that a property with over one hundred years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 35 years remaining, the premises will be equivalent in value to a freehold for many years ahead.
| 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; |
| 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. |
| 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 |
Irrespective of whether you are a tenant or a freeholder in Llandaff,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Llandaff valuers.
Jamie owned a 2 bedroom flat in Llandaff being marketed with a lease of fraction over 61 years left. Jamie informally contacted his landlord being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £200 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Jamie to exercise his statutory right. Jamie obtained expert advice and secured satisfactory resolution without going to tribunal and sell the flat.
In 2009 we were e-mailed by Mr Benjamin Brown who, having purchased a basement flat in Llandaff in October 2007. The dilemma was if we could approximate the price would likely be to prolong the lease by a further 90 years. Identical premises in Llandaff with an extended lease were in the region of £227,800. The average ground rent payable was £45 billed yearly. The lease lapsed in 2089. Given that there were 65 years unexpired we calculated the compensation to the landlord for the lease extension to be within £13,300 and £15,400 not including professional charges.
In 2011 we were e-mailed by Ms Aimee Evans who, having completed a basement apartment in Llandaff in August 2003. We are asked if we could approximate the premium could be to prolong the lease by 90 years. Identical properties in Llandaff with a long lease were valued around £275,000. The mid-range ground rent payable was £55 billed annually. The lease elapsed in 2100. Considering the 76 years unexpired we calculated the premium to the landlord for the lease extension to be within £9,500 and £11,000 not including professional charges.