It’s a harsh certainty that a Arthog residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the Arthog property prices.Once your lease nears 85ish years, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls lower than eighty years - otherwise a higher amount will be due. Most leasehold owners in Arthog will be able to extend under the legislation; however a lawyer should be able to clarify whether you qualify for an extension. In some cases you may not qualify. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer throughout the process.
It is generally accepted that a residential leasehold with over 100 years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 45 years left, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
Using our service gives you increased control over the value of your Arthog leasehold, as your property will be more valuable and saleable in respect of lease length should you wish to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Trailing lengthy negotiations with the freeholder of her leasehold flat in Arthog, Imogen started the lease extension process just as the lease was coming close to the critical 80-year threshold. The lease extension completed in August 2013. The landlord’s costs were kept to an absolute minimum.
In 2012 we were contacted by Dr Benjamin Watson who, having acquired a one bedroom apartment in Arthog in August 2007. We are asked if we could estimate the premium would be to prolong the lease by ninety years. Comparable flats in Arthog with a long lease were worth £168,800. The mid-range ground rent payable was £60 collected every twelve months. The lease concluded in 2081. Having 55 years unexpired we calculated the compensation to the freeholder for the lease extension to be between £31,400 and £36,200 not including expenses.
In 2009 we were phoned by Mr O Edwards who, having completed a garden apartment in Arthog in February 2009. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord could be to extend the lease by an additional years. Comparable homes in Arthog with an extended lease were worth £235,200. The mid-range ground rent payable was £45 billed annually. The lease elapsed in 2092. Taking into account 66 years remaining we approximated the compensation to the freeholder to extend the lease to be within £12,400 and £14,200 plus professional charges.