Burry Port leases on residential properties are gradually losing value. Where your lease has approximately ninety years remaining, you should start thinking about a lease extension. An important point to note is that it is financially advisable for a lease extension to take place before the term of the existing lease drops lower than 80 years - otherwise a higher premium will be due. Leasehold owners in Burry Port will mostly be legally entitled to a lease extension; however a solicitor will confirm if you qualify. In some cases you may not qualify. There are also strict timetables and steps to follow once the process has started so it’s prudent to be guided by a conveyancing solicitor during the process.
Leasehold properties in Burry Port with in excess of 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Engaging our service gives you better control over the value of your Burry Port leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last year George, came dangerously close to the eighty-year threshold with the lease on his garden flat in Burry Port. In buying his flat 18 years previously, the length of the lease was of little concern. As luck would have it, he realised he would soon be paying an inflated amount for a lease extension. George arranged for a lease extension at the eleventh hour in August. George and the freeholder in the end settled on a premium of £5,000 . If he failed to meet the deadline, the price would have increased by at least £1,125.
Mr and Mrs. D Hall bought a recently refurbished flat in Burry Port in July 2004. The dilemma was if we could approximate the compensation to the landlord would likely be for a 90 year lease extension. Comparable flats in Burry Port with an extended lease were valued around £250,400. The mid-range ground rent payable was £65 collected every twelve months. The lease came to a finish in 2089. Having 64 years outstanding we estimated the premium to the freeholder to extend the lease to be between £19,000 and £22,000 not including expenses.
Last month we were phoned by Mr F Michel , who bought a one bedroom apartment in Burry Port in November 2005. We are asked if we could estimate the premium would likely be to prolong the lease by a further 90 years. Comparable properties in Burry Port with a long lease were valued about £184,000. The average ground rent payable was £55 invoiced yearly. The lease terminated in 2078. Taking into account 53 years as a residual term we approximated the premium to the landlord to extend the lease to be between £28,500 and £33,000 not including fees.