It’s a harsh certainty that a Brynmill residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the early years due to the depreciation being disguised by increases in the Brynmill property market.Where your lease has approximately ninety years left, you need to start considering a lease extension. If the number of years remaining drops under 80 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. The marriage fee is the amount of additional value that a lease extension will add the property Most flat owners in Brynmill will be able to extend under the legislation; however a lawyer will be able to clarify whether you qualify for an extension. In some situations you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your lawyer from beginning to end of the process.
Leasehold properties in Brynmill with more than one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date 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. |
| 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. |
Retaining our service will provide you enhanced control over the value of your Brynmill leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Omar owned a 2 bedroom flat in Brynmill being sold with a lease of a few days over 59 years unexpired. Omar on an informal basis approached his landlord being a well known Bristol-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent at the outset set at £150 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Omar to invoke his statutory right. Omar obtained expert advice and secured an acceptable deal informally and readily saleable.
Mr and Mrs. L Torres purchased a studio apartment in Brynmill in September 2010. We are asked if we could approximate the price would be for a 90 year lease extension. Comparable properties in Brynmill with an extended lease were in the region of £166,400. The average ground rent payable was £60 collected quarterly. The lease elapsed on 6 October 2080. Taking into account 54 years unexpired we estimated the compensation to the landlord to extend the lease to be between £32,300 and £37,400 plus costs.
In 2014 we were contacted by Mr and Mrs. W Brooks who, having moved into a ground floor flat in Brynmill in May 2007. The question was if we could shed any light on how much (roughly) compensation to the landlord could be to prolong the lease by ninety years. Comparative premises in Brynmill with 100 year plus lease were in the region of £227,800. The average amount of ground rent was £45 collected every twelve months. The lease terminated on 13 August 2091. Given that there were 65 years as a residual term we estimated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 exclusive of expenses.