Cwmbran leases on domestic deteriorating in value. if your lease has approximately ninety years unexpired, you should start considering the need for a lease extension. Eighty years is a significant number: when the unexpired term of a lease drops below this level then you start incurring an additional element called marriage value. Leasehold owners in Cwmbran will mostly be legally entitled to a lease extension; however a solicitor will confirm your eligibility. In certain cases you may not be entitled. There are prescribed deadlines and steps to follow once the process is initiated so it’s prudent to be guided by a conveyancing solicitor during the process.
It is conventional wisdom that a property with more than one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to any lease with more than 30 years unexpired, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
| 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. |
Using our service will provide you better control over the value of your Cwmbran leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last Christmas Leon, came seriously near to the eighty-year mark with the lease on his ground floor apartment in Cwmbran. Having purchased his home twenty years ago, the lease term was of minimal significance. Luckily, it dawned on him that he needed to take action soon on a lease extension. Leon extended the lease just under the wire in April. Leon and the landlord ultimately settled on an amount of £5,000 . If he not met the deadline, the sum would have escalated by a minimum £1,075.
Mr R Parker purchased a one bedroom apartment in Cwmbran in June 2011. The question was if we could estimate the price could be for a 90 year extension to my lease. Comparable homes in Cwmbran with a long lease were in the region of £270,000. The average amount of ground rent was £55 billed per annum. The lease came to a finish on 13 September 2100. Considering the 75 years outstanding we approximated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 plus fees.
In 2012 we were phoned by Dr I Ali who, having bought a one bedroom apartment in Cwmbran in April 1995. We are asked if we could approximate the price could be to prolong the lease by ninety years. Comparable homes in Cwmbran with an extended lease were valued about £173,800. The average amount of ground rent was £65 collected yearly. The lease terminated on 26 March 2080. Given that there were 55 years remaining we calculated the premium to the landlord to extend the lease to be between £31,400 and £36,200 not including costs.