The value of Builth Wells leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can escalate substantially once the unexpired lease term is less than 80 years
Leasehold residencies in Builth Wells with over 100 years outstanding 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 reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors 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 conveyancing solicitor we work with provide it.
Alexander owned a conversion apartment in Builth Wells on the market with a lease of fraction over fifty eight years outstanding. Alexander informally spoke with his freeholder a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a rise in the rent to £100 annually. Ordinarily, ground rent would not be due on a lease extension were Alexander to invoke his statutory right. Alexander obtained expert advice and was able to make a more informed judgement and deal with the matter and readily saleable.
Ms Sarah Walker completed a recently refurbished flat in Builth Wells in November 1995. We are asked if we could approximate the price could be for a 90 year lease extension. Identical premises in Builth Wells with a long lease were valued around £210,000. The average ground rent payable was £50 billed annually. The lease came to a finish on 14 February 2106. Considering the 80 years remaining we estimated the premium to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of fees.
In 2010 we were called by Mr and Mrs. D Bailey who, having owned a first floor apartment in Builth Wells in April 2006. We are asked if we could estimate the compensation to the landlord would likely be for a 90 year extension to my lease. Identical flats in Builth Wells with 100 year plus lease were valued about £275,000. The average amount of ground rent was £45 collected per annum. The lease ran out in 2095. Having 69 years outstanding we calculated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 plus fees.