Crickhowell leases on domestic deteriorating in value. if your lease has in the region of 90 years unexpired, you should start considering the need for a lease extension. If lease term is under 80 years, you will then have to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to your landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Leasehold owners in Crickhowell will mostly qualify for a lease extension; however a solicitor should be able check if you qualify. In certain cases you may not qualify. There are prescribed timetables and procedures to comply with once the process is initiated so it’s prudent to be guided by a conveyancer during the process.
It is generally accepted that a residential leasehold with in excess of 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 45 years left, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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. |
| 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. |
| 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. |
The conveyancers that we work with handle Crickhowell 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 conveyancing solicitor we work with provide it.
After protracted discussions with the freeholder of her basement flat in Crickhowell, Rosie started the lease extension process as the 80 year threshold was swiftly nearing. The transaction was finalised in March 2008. The freeholder’s fees were negotiated to about five hundred GBP.
Mr and Mrs. H Gunderson bought a newly refurbished apartment in Crickhowell in July 2008. The question was if we could approximate the compensation to the landlord could be to extend the lease by a further 90 years. Comparable homes in Crickhowell with a long lease were worth £260,000. The average ground rent payable was £50 billed yearly. The lease expired on 14 February 2097. Considering the 71 years remaining we calculated the premium to the landlord to extend the lease to be within £9,500 and £11,000 exclusive of expenses.
In 2009 we were approached by Mr and Mrs. P López who, having purchased a garden flat in Crickhowell in August 2007. The dilemma was if we could approximate the compensation to the landlord would be for a 90 year lease extension. Comparative homes in Crickhowell with an extended lease were in the region of £254,200. The average amount of ground rent was £60 collected annually. The lease concluded in 2077. Considering the 51 years as a residual term we estimated the compensation to the freeholder for the lease extension to be within £43,700 and £50,600 plus legals.