Clydach leases on domestic deteriorating in value. Where your lease has approximately 90 years remaining, you should start considering the need for a lease extension. 80 years is a significant number: when the remaining term of a lease drops below this level then you begin incurring an additional element called marriage value. Leasehold owners in Clydach will mostly be legally entitled to a lease extension; however It would be wise to check with a lawyer to check your eligibility. In some situations you may not be entitled. There are prescribed deadlines and steps to follow once the process has commenced so it’s best to be guided by a conveyancing solicitor during the process.
It is conventional wisdom that a property with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 |
The conveyancing solicitors that we work with undertake Clydach 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 2014 Jason, started to get close to the eighty-year threshold with the lease on his studio apartment in Clydach. In buying his flat two decades ago, the length of the lease was of minimal concern. by good luck, it dawned on him that he needed to take steps soon on a lease extension. Jason was able to extend his lease just in the nick of time in June. Jason and the freeholder via the managing agents subsequently settled on a premium of £5,000 . If the lease had dropped lower than 80 years, the premium would have gone up by at least £1,050.
Last Christmas we were phoned by Dr Jasmine Roux , who completed a one bedroom flat in Clydach in March 2004. The question was if we could estimate the compensation to the landlord could be for a 90 year lease extension. Similar homes in Clydach with an extended lease were worth £173,800. The average amount of ground rent was £60 billed monthly. The lease lapsed on 20 January 2080. Given that there were 55 years as a residual term we approximated the compensation to the landlord to extend the lease to be between £31,400 and £36,200 plus fees.
In 2014 we were approached by Ms Kirsty Clark who, having owned a purpose-built apartment in Clydach in August 2001. The dilemma was if we could approximate the price could be for a 90 year extension to my lease. Similar properties in Clydach with 100 year plus lease were valued around £235,200. The average amount of ground rent was £45 collected yearly. The lease lapsed on 16 September 2091. Having 66 years left we approximated the premium to the landlord for the lease extension to be within £12,400 and £14,200 exclusive of fees.