There is no doubt about it a leasehold flat or house in Caerleon is a wasting asset as a result of the diminishing lease term. If the lease has, beyond 100 years to run then this decrease may be of little impact however there will become a stage when a lease has less than 80 years remaining as part of the premium you will incur is what is known as a marriage value. This could increase sharply the cost. It is the main logic behind why you should consider extending sooner than later. The majority of flat owners in Caerleon will meet the qualifying criteria; however a conveyancing solicitor will be able to advise whether you are eligible for a lease extension. In certain situations you may not qualify, the most common reason being that you have owned the property for less than two years.
Leasehold residencies in Caerleon with in excess of one hundred years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges warrant 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; |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
The lawyers that we work with procure Caerleon 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.
Last year Connor, came dangerously close to the eighty-year mark with the lease on his one bedroom apartment in Caerleon. Having bought his home two decades ago, the lease term was of little interest. Thankfully, he realised he needed to take steps soon on a lease extension. Connor extended the lease just ahead of time last March. Connor and the freeholder via the managing agents in the end settled on an amount of £6,000 . If the lease had descended below eighty years, the sum would have increased by a minimum £1,000.
Mr and Mrs. G Lefebvre completed a recently refurbished apartment in Caerleon in August 2008. We are asked if we could approximate the price would likely be for a ninety year lease extension. Comparative homes in Caerleon with an extended lease were in the region of £184,000. The average ground rent payable was £55 billed yearly. The lease ran out in 2078. Considering the 53 years unexpired we estimated the compensation to the landlord to extend the lease to be between £28,500 and £33,000 exclusive of expenses.
In 2012 we were phoned by Mr and Mrs. A Mason who, having took over the lease of a studio flat in Caerleon in October 1996. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to prolong the lease by 90 years. Comparative premises in Caerleon with a long lease were in the region of £290,000. The average amount of ground rent was £45 collected annually. The lease expired in 2098. Given that there were 73 years unexpired we estimated the premium to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of professional charges.