The re-sale value of a leasehold property in Cilfynydd is impacted by how many years the lease has left to run. If it is close to or fewer than 80 years you should envisage problems on re-sale, so it is advisable to arrange for the lease to be extended ahead of purchasing. It is preferable to commence the process of extending the lease is when the lease still has 82 years unexpired so that formalities can be addressed well before the 80 year mark. Statute enables Cilfynydd qualifying lessees to obtain a lease extension of 90 years in addition to the remaining lease term at a peppercorn rent (that is, rent free). The purpose of the valuation is to determine the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
It is generally considered that a residential leasehold with over 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 45 years remaining, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 |
| 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 lawyers that we work with procure Cilfynydd 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.
Trailing unsuccessful negotiations with the freeholder of her one bedroom flat in Cilfynydd, Niamh commenced the lease extension process as the 80 year mark was rapidly advancing. The lease extension was concluded in May 2006. The landlord’s costs were negotiated to slightly above 700 pounds.
Last Spring we were contacted by Dr R Martin , who moved into a studio flat in Cilfynydd in August 2007. We are asked if we could estimate the premium would likely be to extend the lease by a further 90 years. Similar properties in Cilfynydd with an extended lease were worth £246,800. The average ground rent payable was £60 invoiced annually. The lease terminated on 12 April 2076. Given that there were 50 years as a residual term we calculated the compensation to the landlord to extend the lease to be within £44,700 and £51,600 plus professional charges.
Last Autumn we were called by Dr Hannah Clarke , who owned a one bedroom flat in Cilfynydd in November 1996. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be to extend the lease by ninety years. Comparative residencies in Cilfynydd with an extended lease were valued about £208,200. The mid-range ground rent payable was £65 collected annually. The lease lapsed on 12 March 2087. Given that there were 61 years remaining we calculated the compensation to the landlord to extend the lease to be within £19,000 and £22,000 not including legals.