Chances are that where you own a flat in Abercarn you actually own a long leasehold interest over your property
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be worth the same as a freehold for decades to come.
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| 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. |
Irrespective of whether you are a tenant or a landlord in Abercarn,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Abercarn valuers.
Subsequent to lengthy correspondence with the landlord of her studio flat in Abercarn, Madeleine initiated the lease extension process just as the lease was nearing the critical 80-year deadline. The legal work completed in August 2005. The freeholder’s costs were kept to an absolute minimum.
In 2013 we were phoned by Mr Milo Bertrand who, having was assigned a lease of a newly refurbished apartment in Abercarn in June 2009. The dilemma was if we could shed any light on how much (roughly) price would be for a 90 year extension to my lease. Comparable premises in Abercarn with 100 year plus lease were valued about £280,000. The average amount of ground rent was £45 collected monthly. The lease end date was on 16 April 2094. Considering the 70 years left we estimated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 not including fees.
In 2011 we were phoned by Ms N Alexander who, having moved into a ground floor flat in Abercarn in September 2010. The dilemma was if we could approximate the compensation to the landlord would likely be for a 90 year lease extension. Comparative properties in Abercarn with an extended lease were in the region of £218,400. The average amount of ground rent was £60 billed yearly. The lease expired on 25 March 2083. Considering the 59 years remaining we estimated the premium to the freeholder to extend the lease to be between £27,600 and £31,800 plus legals.