It’s an underpublicised certainty that a Cyncoed residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Cyncoed property market.Where your lease has approximately 90 years left, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls under 80 years - otherwise a higher premium will be payable. Most leasehold owners in Cyncoed will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm if you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the process.
Leasehold residencies in Cyncoed with more than one hundred years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges justify it.
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
Retaining our service will provide you enhanced control over the value of your Cyncoed 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 are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In recent months Connor, came seriously near to the 80-year threshold with the lease on his leasehold apartment in Cyncoed. In buying his property two decades ago, the lease term was of little relevance. Thankfully, he became aware that he needed to take steps soon on Extending the lease. Connor extended the lease just under the wire last January. Connor and the landlord in the end agreed on a premium of £6,000 . If he had missed the deadline, the sum would have become more costly by a minimum £950.
In 2009 we were e-mailed by Mr D Díaz who, having acquired a one bedroom flat in Cyncoed in October 2003. We are asked if we could estimate the premium could be for a 90 year lease extension. Similar properties in Cyncoed with an extended lease were in the region of £264,000. The average amount of ground rent was £60 invoiced quarterly. The lease expired on 17 March 2078. Given that there were 53 years outstanding we approximated the compensation to the landlord for the lease extension to be within £37,100 and £42,800 plus expenses.
In 2012 we were e-mailed by Mr and Mrs. K Laurent who, having moved into a basement apartment in Cyncoed in May 2006. The dilemma was if we could estimate the compensation to the landlord would likely be to extend the lease by an additional years. Identical premises in Cyncoed with a long lease were worth £225,400. The average amount of ground rent was £45 collected per annum. The lease terminated on 28 July 2089. Having 64 years left we approximated the compensation to the freeholder to extend the lease to be within £16,200 and £18,600 plus costs.