Chepstow leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. The majority of owners of residential leasehold property in Chepstow enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Chepstow you would be well advised to check if your lease has between seventy and ninety years remaining. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
Leasehold properties in Chepstow with over one hundred years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| 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. |
Using our service gives you better control over the value of your Chepstow leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Theo, came perilously close to the eighty-year threshold with the lease on his leasehold flat in Chepstow. Having purchased his home two decades ago, the unexpired term was of little bearing. Thankfully, he realised he needed to take action soon on Extending the lease. Theo was able to extend his lease at the eleventh hour last March. Theo and the landlord ultimately agreed on an amount of £5,500 . If the lease had descended lower than eighty years, the price would have escalated by a minimum £900.
Last Winter we were e-mailed by Dr Leo Morris , who moved into a basement apartment in Chepstow in July 2009. We are asked if we could shed any light on how much (approximately) price would likely be to extend the lease by a further 90 years. Identical premises in Chepstow with a long lease were in the region of £285,000. The average amount of ground rent was £55 collected annually. The lease elapsed on 8 July 2105. Taking into account 79 years left we approximated the compensation to the freeholder to extend the lease to be within £13,300 and £15,400 plus fees.
Mr Jasper Clarke completed a recently refurbished apartment in Chepstow in September 2012. We are asked if we could approximate the price would likely be for a ninety year lease extension. Similar flats in Chepstow with an extended lease were worth £193,400. The average ground rent payable was £65 billed yearly. The lease came to a finish on 19 October 2085. Considering the 59 years left we calculated the compensation to the landlord for the lease extension to be within £21,900 and £25,200 not including legals.