The market value of Caerwys leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can increase significantly once the remaining term is less than 80 years
It is generally considered that a residential leasehold with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 45 years left, the property will be equivalent in value to a freehold for many years in the future.
| 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
The conveyancers that we work with undertake Caerwys 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 recent months Edward, came precariously close to the eighty-year threshold with the lease on his purpose- built flat in Caerwys. In buying his property two decades ago, the lease term was of no interest. Luckily, he realised he would soon be paying way over the odds for Extending the lease. Edward was able to extend his lease at the eleventh hour in March. Edward and the freeholder in the end settled on the final figure of £6,000 . If he had missed the deadline, the sum would have escalated by at least £1,100.
In 2011 we were contacted by Dr Jasper Edwards who, having bought a one bedroom apartment in Caerwys in January 1996. The question was if we could shed any light on how much (roughly) compensation to the landlord would likely be for a ninety year extension to my lease. Identical premises in Caerwys with 100 year plus lease were in the region of £225,800. The mid-range ground rent payable was £60 invoiced monthly. The lease lapsed on 25 July 2085. Considering the 60 years left we calculated the compensation to the freeholder to extend the lease to be within £25,700 and £29,600 not including costs.
In 2011 we were e-mailed by Ms D Miller who, having was assigned a lease of a garden flat in Caerwys in June 2005. The dilemma was if we could approximate the price would be to prolong the lease by ninety years. Similar flats in Caerwys with an extended lease were worth £210,000. The average ground rent payable was £50 collected annually. The lease lapsed on 6 May 2105. Having 80 years unexpired we approximated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 plus costs.