It’s an underpublicised certainty that a Dunvant residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the depreciation being disguised by increases in the Dunvant property market.Once your lease nears 85ish years, you should 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 premium will be payable. Most leasehold owners in Dunvant will be able to extend under the legislation; however a lawyer will be able to confirm if you are eligibility. In some situations you may not qualify. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancer throughout the process.
Leasehold premises in Dunvant with more than one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Lease extensions in Dunvant can be a difficult process. We recommend you secure professional help from a conveyancer and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Dunvant lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In the wake of 9 months of protracted discussions with the freeholder of her studio flat in Dunvant, Abbie initiated the lease extension process as the 80 year deadline was swiftly coming. The legal work was finalised in November 2009. The freeholder’s charges were kept to an absolute minimum.
Last Autumn we were e-mailed by Mr and Mrs. Y Ali , who bought a one bedroom apartment in Dunvant in March 1996. We are asked if we could estimate the price would likely be to extend the lease by 90 years. Identical properties in Dunvant with 100 year plus lease were in the region of £205,000. The mid-range amount of ground rent was £50 invoiced annually. The lease concluded on 6 March 2104. Given that there were 78 years unexpired we approximated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 plus expenses.
Mr and Mrs. O Girard acquired a one bedroom apartment in Dunvant in October 2002. The dilemma was if we could estimate the compensation to the landlord would likely be to extend the lease by 90 years. Comparable premises in Dunvant with an extended lease were valued around £267,600. The mid-range amount of ground rent was £65 invoiced monthly. The lease ran out on 21 February 2093. Considering the 67 years unexpired we calculated the premium to the landlord to extend the lease to be between £14,300 and £16,400 plus legals.