The market value of a leasehold property in Aberporth is impacted by how many years the lease has left to run. If it is close to or less than 80 years you should anticipate difficulties on re-sale, so it is advisable to arrange for the lease to be extended ahead of buying. It is ideal to start the process of extending the lease is when the lease still has 82 years to run so that all matters can be finalised prior to the eighty year mark. Current legislation enables Aberporth qualifying lessees to obtain a lease extension of ninety years in addition to the remaining lease term at a peppercorn rent (that is, rent free). The purpose of the valuation is to determine the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
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 ninety years added to any lease with more than 35 years left, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Chelsea 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Aberporth can be a difficult process. We recommend you procure guidance from a conveyancing solicitor and valuer well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring Aberporth lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
After protracted correspondence with the landlord of her first floor flat in Aberporth, Louise started the lease extension process just as her lease was approaching the crucial 80-year deadline. The legal work completed in January 2009. The freeholder’s fees were negotiated to a tad over 550 pounds.
Last month we were e-mailed by Mr and Mrs. L Cox , who purchased a purpose-built flat in Aberporth in July 2010. We are asked if we could approximate the compensation to the landlord could be to extend the lease by ninety years. Similar flats in Aberporth with 100 year plus lease were worth £280,000. The mid-range ground rent payable was £45 billed annually. The lease came to a finish on 21 October 2097. Given that there were 71 years outstanding we estimated the premium to the landlord to extend the lease to be within £12,400 and £14,200 plus costs.
Dr F Fournier moved into a garden apartment in Aberporth in September 1995. The dilemma was if we could approximate the compensation to the landlord could be to prolong the lease by a further 90 years. Comparable flats in Aberporth with 100 year plus lease were worth £225,800. The mid-range amount of ground rent was £60 invoiced yearly. The lease ended on 25 June 2086. Given that there were 60 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £25,700 and £29,600 exclusive of expenses.