Grangetown leases on residential properties are gradually losing 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 Grangetown enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Grangetown you would be well advised to investigate if your lease has between 70 and 90 years left. In particular once the remaining lease term slips under 80 years, the cost of any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
Leasehold residencies in Grangetown with over one hundred years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancing solicitors that we work with procure Grangetown 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 lawyer we work with provide it.
In the wake of 6 months of unsuccessful discussions with the landlord of her ground floor flat in Grangetown, Megan started the lease extension process just as the lease was approaching the crucial eighty-year threshold. The transaction was finalised in July 2006. The landlord’s charges were kept to an absolute minimum.
Last year we were contacted by Dr Daisy Lewis , who took over the lease of a purpose-built apartment in Grangetown in April 2007. The dilemma was if we could approximate the price could be to prolong the lease by 90 years. Comparative residencies in Grangetown with an extended lease were worth £200,000. The average amount of ground rent was £50 invoiced monthly. The lease elapsed in 2103. Having 77 years left we calculated the premium to the landlord for the lease extension to be within £8,600 and £9,800 plus professional charges.
Mr Jason Peterson was assigned a lease of a purpose-built flat in Grangetown in March 2007. The dilemma was if we could shed any light on how much (roughly) price would be to prolong the lease by an additional years. Similar properties in Grangetown with a long lease were valued about £260,200. The mid-range amount of ground rent was £65 invoiced monthly. The lease terminated on 18 August 2092. Having 66 years unexpired we estimated the premium to the landlord for the lease extension to be within £16,200 and £18,600 exclusive of legals.