As the the remaining lease term of a Pentwyn residential lease decreases so does its value and therefore the value of your property. Where the lease has, over one hundred years to run then this decrease may be negligible however there will become a point in time when a lease has less than eighty years left as part of the premium you will incur is what is termed as a marriage value. This could increase markedly the cost. It is the primary reason why you should extend the lease without delay. The majority of flat owners in Pentwyn will meet the qualifying criteria; nevertheless a conveyancer can confirm whether you are eligible for a lease extension. In certain situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
It is conventional wisdom that a residential leasehold with in excess of 100 years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
The lawyers that we work with handle Pentwyn 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.
In 2014 Seth, started to get near to the 80-year mark with the lease on his leasehold flat in Pentwyn. In buying his property twenty years previously, the length of the lease was of no significance. As luck would have it, he became aware that he needed to take action soon on Extending the lease. Seth extended the lease just ahead of time in September. Seth and the landlord eventually agreed on the final figure of £5,000 . If he not met the deadline, the sum would have increased by at least £950.
In 2012 we were contacted by Mr and Mrs. Y Martínez who, having completed a garden flat in Pentwyn in February 2002. We are asked if we could approximate the compensation to the landlord would be for a ninety year lease extension. Similar properties in Pentwyn with an extended lease were worth £260,200. The mid-range amount of ground rent was £65 billed monthly. The lease concluded on 11 June 2090. Taking into account 66 years outstanding we calculated the compensation to the landlord to extend the lease to be within £16,200 and £18,600 not including legals.
Mr and Mrs. D Rogers took over the lease of a one bedroom flat in Pentwyn in January 2011. We are asked if we could approximate the price would likely be for a ninety year lease extension. Comparable properties in Pentwyn with 100 year plus lease were worth £198,800. The mid-range amount of ground rent was £55 collected annually. The lease expired in 2079. Considering the 55 years left we calculated the premium to the freeholder to extend the lease to be between £33,300 and £38,400 exclusive of costs.