For those whose Barry Island flat is held on a long lease, the message is clear – if you do nothing, the property will eventually revert to the freeholder, leaving you empty-handed. The fewer the years remaining the lower the value of the property and the more expensive it will be to extend the lease.
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 additional 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for many years in the future.
| 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; |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Barry Island can be a difficult process. We recommend you procure professional help from a lawyer 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 a wealth of experience dealing with Barry Island 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 Andrew, started to get close to the eighty-year mark with the lease on his studio apartment in Barry Island. Having bought his home two decades ago, the lease term was of no significance. Thankfully, he noticed he needed to take action soon on a lease extension. Andrew extended the lease at the eleventh hour last July. Andrew and the landlord ultimately settled on an amount of £6,000 . If the lease had slid to less than eighty years, the sum would have increased by a minimum £925.
Mrs G Rivera acquired a one bedroom apartment in Barry Island in September 1998. The question was if we could estimate the premium could be to extend the lease by 90 years. Comparable homes in Barry Island with 100 year plus lease were worth £260,000. The mid-range amount of ground rent was £50 collected annually. The lease came to a finish on 15 July 2097. Having 72 years as a residual term we calculated the premium to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of fees.
Last month we were e-mailed by Dr Isabelle Johnson , who owned a purpose-built flat in Barry Island in October 1996. The dilemma was if we could shed any light on how much (approximately) price could be to extend the lease by an additional years. Comparable premises in Barry Island with 100 year plus lease were worth £256,600. The mid-range ground rent payable was £60 billed every twelve months. The lease finished in 2077. Taking into account 52 years as a residual term we estimated the premium to the landlord for the lease extension to be between £39,000 and £45,000 not including expenses.