The closer a residential lease in Cathays gets to zero years unexpired, the the greater the reduction in the value of the property. Where the lease has, beyond 100 years remaining then this decrease may be negligible nevertheless there will become a point in time when a lease has under than 80 years unexpired as part of the premium you will incur is what is known as a marriage value. This could be significant. It is the primary reason why you should consider extending sooner than later. The majority of flat owners in Cathays will qualify for this right; that being said a lawyer will be able to confirm if you qualify to extend your lease. In certain situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
Leasehold premises in Cathays with over one hundred years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service will provide you enhanced control over the value of your Cathays leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of lengthy negotiations with the freeholder of her leasehold apartment in Cathays, Imogen commenced the lease extension process as the 80 year threshold was quickly coming. The lease extension was finalised in April 2010. The landlord’s charges were kept to an absolute minimum.
In 2013 we were contacted by Dr Rory Bailey who, having bought a studio flat in Cathays in February 1997. We are asked if we could shed any light on how much (approximately) premium would be to prolong the lease by an additional years. Similar flats in Cathays with an extended lease were worth £166,400. The mid-range amount of ground rent was £60 invoiced yearly. The lease finished in 2079. Having 54 years remaining we estimated the premium to the freeholder to extend the lease to be within £32,300 and £37,400 not including fees.
Dr Dylan André completed a first floor flat in Cathays in June 2011. We are asked if we could shed any light on how much (roughly) price would likely be to extend the lease by ninety years. Similar properties in Cathays with an extended lease were in the region of £227,800. The mid-range ground rent payable was £45 collected annually. The lease ran out on 8 September 2090. Given that there were 65 years outstanding we calculated the premium to the freeholder to extend the lease to be within £13,300 and £15,400 exclusive of professional charges.