Abercarn leases on residential properties are gradually losing value. Where your lease has in the region of ninety years left, you should start considering the need for a lease extension. If lease term dips under eighty years, you will then have to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to your landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Leasehold owners in Abercarn will mostly qualify for a lease extension; however a solicitor will confirm your eligibility. In certain circumstances you may not qualify. There are also strict deadlines and steps to comply with once the process has commenced so it’s best to be guided by a conveyancing solicitor during the process.
Leasehold properties in Abercarn with over 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and service charges merit it.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 lawyers that we work with handle Abercarn 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.
Leon was the the leasehold proprietor of a conversion flat in Abercarn being marketed with a lease of just over 59 years left. Leon on an informal basis contacted his landlord a well known London-based freehold company for a lease extension. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £100 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Leon to exercise his statutory right. Leon procured expert legal guidance and was able to make an informed decision and handle with the matter and readily saleable.
In 2010 we were contacted by Dr Riley Sánchez who, having was assigned a lease of a ground floor apartment in Abercarn in February 2000. We are asked if we could estimate the price would likely be for a 90 year extension to my lease. Comparable residencies in Abercarn with an extended lease were valued about £295,000. The mid-range amount of ground rent was £45 collected per annum. The lease finished on 10 October 2099. Taking into account 74 years remaining we approximated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 not including costs.
Last Christmas we were e-mailed by Mr Kai Reed , who took over the lease of a one bedroom apartment in Abercarn in February 2000. We are asked if we could estimate the premium would be for a ninety year lease extension. Comparable premises in Abercarn with an extended lease were worth £243,000. The average amount of ground rent was £65 invoiced monthly. The lease finished in 2088. Taking into account 63 years as a residual term we calculated the compensation to the landlord for the lease extension to be within £20,000 and £23,000 exclusive of expenses.