It’s an underpublicised certainty that a Aberystwyth residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the depreciation being disguised by increases in the Aberystwyth property market.Where your lease has approximately 90 years left, you need to start thinking about a lease extension. If the number of years remaining falls under eighty years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Aberystwyth will be able to extend under the legislation; however a lawyer should be able to confirm if you qualify for an extension. In some cases you may not qualify. There are also strict timetables and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancer from beginning to end of the formalities.
Leasehold residencies in Aberystwyth with over 100 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 property. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 Aberystwyth can be a difficult process. We recommend you obtain guidance from a conveyancing solicitor and surveyor 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 Aberystwyth lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last year Owen, came very close to the 80-year mark with the lease on his purpose- built flat in Aberystwyth. Having purchased his home 18 years ago, the unexpired term was of minimal bearing. As luck would have it, he noticed he needed to take action soon on a lease extension. Owen was able to extend his lease just ahead of time last March. Owen and the landlord subsequently agreed on sum of £5,500 . If he had missed the deadline, the sum would have increased by a minimum £950.
Last month we were phoned by Mr and Mrs. W Mitchell , who was assigned a lease of a garden apartment in Aberystwyth in April 2006. The question was if we could shed any light on how much (roughly) premium would likely be to extend the lease by a further 90 years. Comparable properties in Aberystwyth with an extended lease were valued around £200,000. The mid-range ground rent payable was £50 billed every twelve months. The lease termination date was in 2103. Given that there were 77 years as a residual term we approximated the premium to the landlord to extend the lease to be within £8,600 and £9,800 not including fees.
Last Summer we were contacted by Mr Jude Smith , who took over the lease of a studio apartment in Aberystwyth in March 1999. We are asked if we could approximate the premium would be to prolong the lease by ninety years. Identical flats in Aberystwyth with a long lease were worth £260,200. The average ground rent payable was £65 invoiced yearly. The lease concluded in 2092. Taking into account 66 years remaining we approximated the compensation to the freeholder for the lease extension to be between £14,300 and £16,400 exclusive of legals.