Trefnant leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Trefnant residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Trefnant you must see if your lease has between 70 and ninety years left. There are good reasons why a Trefnant flat owner with a lease having around eighty years remaining should take action to make sure that a lease extension is put in place without delay
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| Yorkshire 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. |
The conveyancers that we work with procure Trefnant 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 recent months Ryan, came very near to the eighty-year threshold with the lease on his one bedroom flat in Trefnant. In buying his home two decades ago, the unexpired term was of minimal interest. Thankfully, he recognised he would soon be paying an escalated premium for Extending the lease. Ryan arranged for a lease extension just under the wire in June. Ryan and the freeholder via the management company in the end settled on a premium of £5,500 . If he failed to meet the deadline, the premium would have become more exhorbitant by at least £975.
In 2009 we were approached by Mr Stanley Bailey who, having owned a ground floor flat in Trefnant in May 2000. The dilemma was if we could estimate the premium would likely be to extend the lease by a further 90 years. Comparable flats in Trefnant with a long lease were in the region of £254,200. The mid-range amount of ground rent was £60 billed quarterly. The lease ended on 22 January 2076. Having 51 years as a residual term we calculated the compensation to the freeholder to extend the lease to be within £43,700 and £50,600 not including professional charges.
Last Summer we were e-mailed by Mrs Imogen Johnson , who took over the lease of a first floor apartment in Trefnant in November 2001. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be to extend the lease by 90 years. Comparable homes in Trefnant with an extended lease were worth £210,600. The mid-range amount of ground rent was £45 billed yearly. The lease finished on 20 August 2087. Taking into account 62 years outstanding we estimated the compensation to the freeholder for the lease extension to be within £18,100 and £20,800 plus costs.