Caernarfon 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 becomes more expensive. Legislation has been in place for sometime now allowing qualifying Caernarfon residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Caernarfon you should see if your lease has between 70 and 90 years remaining. There are compelling reasons why a Caernarfon leaseholder with a lease having around 80 years left should take steps to ensure that a lease extension is actioned without delay
Leasehold residencies in Caernarfon with in excess of one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| 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. |
The conveyancing solicitors that we work with procure Caernarfon 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.
Cameron owned a 2 bedroom flat in Caernarfon on the market with a lease of a little over sixty years remaining. Cameron informally contacted his landlord a well known Manchester-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent to start with set at £200 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Cameron to exercise his statutory right. Cameron procured expert advice and secured satisfactory deal without resorting to tribunal and ending up with a market value flat.
Last Winter we were phoned by Mr and Mrs. D Cook , who bought a one bedroom apartment in Caernarfon in October 1998. We are asked if we could shed any light on how much (roughly) premium would likely be to prolong the lease by 90 years. Comparable homes in Caernarfon with an extended lease were worth £275,000. The mid-range ground rent payable was £65 invoiced yearly. The lease expired in 2094. Considering the 68 years unexpired we estimated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 plus legals.
Last month we were called by Mrs M Evans , who moved into a first floor flat in Caernarfon in January 2000. The question was if we could approximate the price could be for a ninety year extension to my lease. Identical flats in Caernarfon with a long lease were worth £208,600. The average ground rent payable was £60 billed every twelve months. The lease expired in 2083. Considering the 57 years outstanding we approximated the compensation to the landlord to extend the lease to be between £30,400 and £35,200 not including professional charges.