Unfortunately that a Bargoed residential lease is a deteriorating asset. As the lease term diminishes 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 Bargoed property market.Once your lease nears 85ish years, you need to start considering a lease extension. If the number of years remaining slips under eighty years, you will then be required to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property Most leasehold owners in Bargoed will be able to extend under the legislation; however a conveyancing solicitor will 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 lawyer throughout the process.
It is generally considered that a property with over one hundred years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | 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 75 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Irrespective of whether you are a tenant or a landlord in Bargoed,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 in-depth market knowledge and the close ties they enjoy with Bargoed valuers.
In recent months Callum, came seriously close to the eighty-year threshold with the lease on his ground floor apartment in Bargoed. In buying his home 19 years previously, the unexpired term was of minimal significance. by good luck, it dawned on him that he would imminently be paying way over the odds for a lease extension. Callum arranged for a lease extension just under the wire last August. Callum and the landlord who owned the flat above in the end settled on an amount of £5,500 . If he not met the deadline, the amount would have become more costly by at least £1,000.
Mr and Mrs. S Lambert acquired a one bedroom flat in Bargoed in April 2012. We are asked if we could estimate the price would be for a 90 year extension to my lease. Comparable flats in Bargoed with an extended lease were worth £206,200. The average ground rent payable was £60 billed per annum. The lease expiry date was on 25 November 2082. Having 56 years outstanding we approximated the premium to the landlord to extend the lease to be within £31,400 and £36,200 not including costs.
Last Summer we were phoned by Dr Natalie Lambert , who acquired a one bedroom flat in Bargoed in September 2007. The question was if we could shed any light on how much (approximately) price would be for a 90 year extension to my lease. Similar properties in Bargoed with 100 year plus lease were valued around £300,000. The mid-range ground rent payable was £50 invoiced annually. The lease end date was on 25 April 2102. Given that there were 76 years as a residual term we calculated the compensation to the landlord for the lease extension to be between £8,600 and £9,800 exclusive of costs.