Unfortunately that a Dunvant residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the Dunvant property prices.Once your lease gets to 85ish years, 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 dips below 80 years - otherwise a higher amount will be payable. Most flat owners in Dunvant will be able to extend under the legislation; however a conveyancer will be able to clarify whether you are eligibility. In some situations you may not qualify. There are also strict timeframes and procedures to follow once the process is instigated and you will need to be guided by your lawyer for the duration of the formalities.
Leasehold premises in Dunvant with in excess of one hundred years unexpired 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 upside in purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
The conveyancers that we work with handle Dunvant 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 conveyancer we work with provide it.
During the course of the last few months Hugo, started to get near to the eighty-year mark with the lease on his purpose- built apartment in Dunvant. In buying his flat two decades ago, the length of the lease was of little importance. by good luck, he realised he needed to take steps soon on Extending the lease. Hugo extended the lease just ahead of time in June. Hugo and the freeholder eventually settled on a premium of £6,000 . If the lease had fallen below 80 years, the price would have gone up by at least £1,000.
Dr Katherine Michel acquired a ground floor apartment in Dunvant in April 2006. We are asked if we could estimate the premium could be for a ninety year extension to my lease. Identical properties in Dunvant with a long lease were valued around £233,200. The average amount of ground rent was £60 billed per annum. The lease ended on 21 October 2087. Considering the 61 years left we approximated the compensation to the landlord for the lease extension to be within £22,800 and £26,400 plus costs.
Mr Alexander Brown acquired a purpose-built flat in Dunvant in May 2011. We are asked if we could approximate the compensation to the landlord would be to prolong the lease by ninety years. Comparative flats in Dunvant with 100 year plus lease were worth £171,800. The mid-range ground rent payable was £55 collected per annum. The lease lapsed on 22 August 2076. Given that there were 50 years unexpired we calculated the premium to the landlord to extend the lease to be within £32,300 and £37,400 not including costs.