Builth Wells leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. It is the case that most Builth Wells tenants have the right to extend their lease by an additional ninety years by virtue of the 1993 Leasehold Reform Act. Where you are a leasehold owner in Builth Wells you really ought to check if your lease has between seventy and ninety years left. In particular once the remaining lease term slips under eighty years, the compensation to the landlord for any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
Leasehold properties in Builth Wells with more than 100 years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Coventry Building Society | 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 be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
The conveyancers that we work with procure Builth Wells lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancer we work with provide it.
In the wake of eight months of lengthy discussions with the landlord of her two bedroom flat in Builth Wells, Nicole initiated the lease extension process as the eighty year mark was swiftly approaching. The transaction completed in June 2014. The freeholder’s fees were restricted to below 550 GBP.
Last Summer we were e-mailed by Mr and Mrs. T Torres , who was assigned a lease of a studio apartment in Builth Wells in February 2002. The question was if we could approximate the compensation to the landlord would be for a 90 year extension to my lease. Comparative residencies in Builth Wells with 100 year plus lease were in the region of £233,200. The mid-range ground rent payable was £60 invoiced every twelve months. The lease expiry date was in 2087. Considering the 61 years unexpired we approximated the premium to the freeholder to extend the lease to be within £22,800 and £26,400 not including fees.
In 2011 we were e-mailed by Mr J Parker who, having owned a studio apartment in Builth Wells in July 2004. The dilemma was if we could approximate the compensation to the landlord would be to prolong the lease by ninety years. Identical premises in Builth Wells with an extended lease were in the region of £166,800. The mid-range ground rent payable was £50 collected annually. The lease came to a finish in 2076. Taking into account 50 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £32,300 and £37,400 exclusive of legals.