There is no doubt about it a leasehold property in Deeside is a wasting asset as a result of the diminishing lease term. Where the residual term has, in excess of 99 years to run then this decrease may be negligible nevertheless there will become a point in time when a lease has under than 80 years left as part of the premium you will incur is what is known as a marriage value. This could increase markedly the cost. It is the primary rational as to why you should consider extending sooner rather than later. Many flat owners in Deeside will meet the qualifying criteria; that being said a conveyancing solicitor can confirm whether you are eligible to extend your lease. In limited situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
Leasehold properties in Deeside with more than 100 years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with procure Deeside 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 lengthy negotiations with the freeholder of her basement flat in Deeside, Grace started the lease extension process as the eighty year mark was swiftly approaching. The lease extension was finalised in November 2009. The freeholder’s fees were kept to an absolute minimum.
Dr D Hill completed a purpose-built flat in Deeside in August 2001. The dilemma was if we could estimate the premium could be to prolong the lease by ninety years. Identical flats in Deeside with an extended lease were valued about £252,800. The average amount of ground rent was £65 collected per annum. The lease ended in 2090. Taking into account 65 years unexpired we approximated the compensation to the landlord for the lease extension to be between £17,100 and £19,800 exclusive of professional charges.
In 2014 we were e-mailed by Dr C Nelson who, having was assigned a lease of a ground floor flat in Deeside in May 2011. The question was if we could estimate the price could be for a ninety year lease extension. Comparable flats in Deeside with 100 year plus lease were in the region of £191,400. The mid-range amount of ground rent was £55 billed yearly. The lease terminated in 2079. Having 54 years remaining we estimated the compensation to the freeholder for the lease extension to be between £34,200 and £39,600 not including costs.