Dunvant leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. The majority of owners of residential leasehold property in Dunvant enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Dunvant you really ought to investigate if your lease has between 70 and 90 years remaining. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension increases dramatically as an element of the premium you pay is what is known as a marriage value
Leasehold premises in Dunvant with more than one hundred years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset 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 gives you increased control over the value of your Dunvant leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In recent months Isaac, came critically near to the 80-year threshold with the lease on his studio apartment in Dunvant. In buying his home two decades ago, the lease term was of no significance. Thankfully, he noticed he would imminently be paying an inflated amount for Extending the lease. Isaac arranged for a lease extension at the eleventh hour last September. Isaac and the freeholder in the end settled on an amount of £5,000 . If the lease had slid to less than 80 years, the sum would have become more exhorbitant by at least £925.
Ms Georgia Robinson owned a basement flat in Dunvant in September 1997. The dilemma was if we could shed any light on how much (roughly) price would likely be to prolong the lease by 90 years. Comparative premises in Dunvant with 100 year plus lease were worth £275,000. The mid-range amount of ground rent was £65 invoiced quarterly. The lease lapsed in 2093. Given that there were 68 years outstanding we calculated the compensation to the landlord for the lease extension to be between £12,400 and £14,200 exclusive of expenses.
Last year we were approach by Mr and Mrs. G Lambert , who was assigned a lease of a purpose-built flat in Dunvant in March 1997. The dilemma was if we could estimate the premium would likely be to extend the lease by an additional years. Comparative properties in Dunvant with an extended lease were in the region of £208,600. The average ground rent payable was £60 billed yearly. The lease concluded on 19 February 2082. Considering the 57 years outstanding we estimated the premium to the freeholder to extend the lease to be between £30,400 and £35,200 exclusive of costs.