Unfortunately that a Clun residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the first few years due to the depreciation being disguised by increases in the Clun property prices.Where your lease has approximately 90 years left, you should start considering a lease extension. If lease term dips under 80 years, you will then be required to pay 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property Most leasehold owners in Clun will be able to extend under the legislation; however a lawyer should be able to confirm whether you qualify for an extension. In some cases you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancer throughout the process.
It is conventional wisdom that a residential leasehold with in excess of one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 30 years left, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Coventry Building Society | 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. |
| Halifax | 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 also be not less than 75 years at the outset 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. |
Lease extensions in Clun can be a difficult process. We recommend you get professional help from a lawyer and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Clun lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
After lengthy correspondence with the freeholder of her ground floor apartment in Clun, Bethan initiated the lease extension process as the 80 year deadline was fast nearing. The legal work was concluded in November 2014. The landlord’s charges were negotiated to slightly above four hundred pounds.
Mr and Mrs. F Sánchez completed a studio flat in Clun in March 2009. The dilemma was if we could shed any light on how much (roughly) premium would be to extend the lease by 90 years. Identical flats in Clun with a long lease were worth £285,000. The mid-range amount of ground rent was £55 collected yearly. The lease ended on 20 July 2104. Considering the 79 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £13,300 and £15,400 not including costs.
Mr and Mrs. S Anderson was assigned a lease of a one bedroom flat in Clun in September 2011. We are asked if we could approximate the premium would be to prolong the lease by an additional years. Comparative properties in Clun with a long lease were worth £193,400. The mid-range ground rent payable was £65 invoiced annually. The lease expired in 2084. Having 59 years as a residual term we calculated the premium to the freeholder for the lease extension to be between £21,900 and £25,200 exclusive of expenses.