For those whose Blaenavon home is held on a long lease, the message is clear – if nothing is done, your property will eventually revert to the freeholder, leaving you empty-handed. The shorter the lease the lower the value of the property and the more expensive it will be to obtain a lease extension.
Leasehold premises in Blaenavon with more than one hundred years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges justify it.
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Yorkshire 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. |
Lease extensions in Blaenavon can be a difficult process. We recommend you get guidance from a conveyancing solicitor and valuer with experience in lease extensions.
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 Blaenavon lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
James owned a studio flat in Blaenavon on the market with a lease of just over 59 years outstanding. James informally spoke with his landlord a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £200 per annum. Ordinarily, ground rent would not be due on a lease extension were James to invoke his statutory right. James obtained expert legal guidance and was able to make an informed decision and handle with the matter and ending up with a market value flat.
Mr and Mrs. N Davies moved into a recently refurbished apartment in Blaenavon in June 1999. The dilemma was if we could approximate the compensation to the landlord would likely be to extend the lease by a further 90 years. Comparable properties in Blaenavon with a long lease were in the region of £280,000. The average amount of ground rent was £55 billed annually. The lease elapsed in 2103. Having 78 years left we calculated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of expenses.
In 2011 we were contacted by Mr George Thomas who, having purchased a one bedroom apartment in Blaenavon in November 2011. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be to prolong the lease by ninety years. Comparable residencies in Blaenavon with 100 year plus lease were in the region of £191,000. The average amount of ground rent was £65 invoiced every twelve months. The lease elapsed in 2083. Having 58 years left we calculated the premium to the freeholder to extend the lease to be within £23,800 and £27,400 not including costs.