The market value of a leasehold property in Creigiau depends on how many years the lease has remaining. If it is close to or less than 80 years you should foresee difficulties on re-sale, so it is recommended to arrange for a lease extension prior to purchasing. It is preferable to commence the lease extension process when the lease still has 82 years unexpired so that all matters can be finalised in advance of the eighty year threshold. Statute entitles Creigiau qualifying lessees to an additional term of ninety years in addition to the existing term, at a nominal rent (no ground rent). The purpose of the valuation is to determine the amount payable by the lessee to the freeholder for the purchase of the lease extension.
It is generally considered that a residential leasehold with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 30 years unexpired, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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. |
| 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 |
| 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. |
Engaging our service will provide you enhanced control over the value of your Creigiau leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Isaac was the the leasehold proprietor of a high value flat in Creigiau being sold with a lease of a few days over 59 years outstanding. Isaac on an informal basis approached his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Isaac to exercise his statutory right. Isaac obtained expert advice and was able to make a more informed decision and deal with the matter and readily saleable.
Ms S Lefebvre took over the lease of a studio flat in Creigiau in August 1995. We are asked if we could estimate the compensation to the landlord would be to extend the lease by ninety years. Comparable flats in Creigiau with 100 year plus lease were valued around £280,000. The mid-range ground rent payable was £55 billed monthly. The lease lapsed in 2103. Having 78 years remaining we approximated the premium to the landlord for the lease extension to be within £13,300 and £15,400 exclusive of fees.
Last Summer we were e-mailed by Mr and Mrs. W Mitchell , who moved into a one bedroom flat in Creigiau in June 1997. The question was if we could estimate the price could be for a 90 year lease extension. Identical homes in Creigiau with an extended lease were worth £186,000. The mid-range ground rent payable was £65 invoiced yearly. The lease ran out in 2083. Given that there were 58 years left we calculated the premium to the freeholder for the lease extension to be between £24,700 and £28,600 exclusive of legals.