There is no doubt about it a leasehold flat or house in Risca is a wasting asset as a result of the diminishing lease term. Where the lease has, more than 125 years remaining then this decrease may be fractional nevertheless there will become a stage when a lease has under than eighty years unexpired as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the main reason why you should extend the lease sooner rather than later. Many flat owners in Risca will meet the qualifying criteria; however a lawyer will be able to confirm if you qualify to extend your lease. In limited situations you may not qualify, the most common reason being that you have owned the property for less than two years.
Leasehold residencies in Risca with over one hundred years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with procure Risca 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.
Last October Sam, started to get close to the 80-year threshold with the lease on his basement flat in Risca. Having purchased his home two decades ago, the length of the lease was of little relevance. Thankfully, he recognised he needed to take steps soon on Extending the lease. Sam extended the lease just under the wire last July. Sam and the landlord in the end agreed on a premium of £6,000 . If he had missed the deadline, the price would have gone up by a minimum £1,100.
In 2014 we were approached by Ms M Parker who, having completed a garden apartment in Risca in May 2004. We are asked if we could shed any light on how much (approximately) price would likely be to prolong the lease by an additional years. Identical properties in Risca with a long lease were valued about £176,200. The average amount of ground rent was £65 collected every twelve months. The lease concluded in 2081. Given that there were 56 years outstanding we approximated the compensation to the freeholder for the lease extension to be between £29,500 and £34,000 plus fees.
Mr George François purchased a basement flat in Risca in March 2008. We are asked if we could estimate the compensation to the landlord would be to prolong the lease by 90 years. Comparative premises in Risca with a long lease were worth £242,600. The mid-range ground rent payable was £45 invoiced monthly. The lease terminated in 2092. Considering the 67 years as a residual term we calculated the premium to the landlord to extend the lease to be within £11,400 and £13,200 plus professional charges.