Owning a apartment usually means owning a lease of the property, which has a finite term of years. The lease will normally be granted for a fixed period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Pentwyn. Clearly, the term of lease left reduces over time. This is often ignored and only raises itself as an issue when the residence has to be sold or re-mortgaged. The shorter the lease the less it is worth and the more it will cost to extend the lease. Qualifying leaseholders in Pentwyn have the right to extend the lease for an additional 90 years in accordance with Leasehold Reform legislation. Please give careful deliberation before putting off your Pentwyn lease extension. Putting off that expense now simply increases the price you will ultimately incur for a lease extension
It is conventional wisdom that a residential leasehold with more than 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
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 conveyancer we work with provide it.
Austin owned a studio flat in Pentwyn on the market with a lease of just over sixty years remaining. Austin on an informal basis contacted his landlord a well known Bristol-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent initially set at £150 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Austin to invoke his statutory right. Austin obtained expert legal guidance and was able to make a more informed decision and deal with the matter and sell the flat.
Last Christmas we were e-mailed by Dr K Wood , who acquired a garden apartment in Pentwyn in August 2005. We are asked if we could estimate the premium could be to prolong the lease by 90 years. Comparable premises in Pentwyn with 100 year plus lease were in the region of £295,000. The mid-range ground rent payable was £50 collected yearly. The lease came to a finish in 2100. Having 75 years left we calculated the premium to the landlord to extend the lease to be between £8,600 and £9,800 exclusive of expenses.
Last Autumn we were contacted by Dr C Peterson , who was assigned a lease of a basement apartment in Pentwyn in June 1995. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would likely be for a ninety year extension to my lease. Comparable flats in Pentwyn with a long lease were valued about £250,400. The average ground rent payable was £65 invoiced annually. The lease concluded in 2089. Having 64 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £19,000 and £22,000 not including legals.