The re-sale value of a leasehold property in Garndolbenmaen is impacted by how long the lease has left to run. If it is close to or fewer than eighty years you should foresee difficulties on re-sale, so it is advisable to arrange for a lease extension before buying. It is ideal to start the lease extension process when a lease still has 82 years unexpired so that formalities can be addressed prior to the eighty year cut off point. Leasehold Reform legislation entitles Garndolbenmaen qualifying lessees to acquire a new lease which will be for the balance of the existing lease plus a further term of ninety years. The intention of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a residential leasehold with in excess of 100 years remaining is worth approximately the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for decades to come.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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:
|
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Regardless of whether you are a tenant or a freeholder in Garndolbenmaen,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Garndolbenmaen valuers.
David owned a conversion apartment in Garndolbenmaen on the market with a lease of fraction over 72 years remaining. David informally approached his freeholder being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £200 annually. Ordinarily, ground rent would not be payable on a lease extension were David to exercise his statutory right. David obtained expert advice and was able to make a more informed judgement and deal with the matter and sell the flat.
Last Christmas we were phoned by Mr and Mrs. D Martínez , who purchased a purpose-built flat in Garndolbenmaen in August 1998. The dilemma was if we could estimate the price would likely be to prolong the lease by ninety years. Comparative premises in Garndolbenmaen with an extended lease were in the region of £270,000. The mid-range ground rent payable was £55 collected monthly. The lease ended on 19 March 2101. Considering the 75 years left we estimated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 exclusive of costs.
Ms Yasmin Bennett moved into a garden flat in Garndolbenmaen in August 2006. We are asked if we could shed any light on how much (approximately) premium could be to prolong the lease by a further 90 years. Comparable premises in Garndolbenmaen with a long lease were valued around £173,800. The average ground rent payable was £60 billed per annum. The lease terminated in 2081. Given that there were 55 years as a residual term we calculated the premium to the freeholder for the lease extension to be within £31,400 and £36,200 exclusive of professional charges.