The re-sale value of a leasehold property in Gwernaffield is impacted by how long the lease has left to run. If it is close to or fewer than 80 years you should expect problems on re-sale, so it is advisable to arrange for the lease to be extended prior to purchasing. Ideally one should start the lease extension process when a lease still has 82 years unexpired so that all matters can be concluded ahead of the 80 year threshold. Current legislation entitles Gwernaffield qualifying lessees to a 90 year extension added to their unexpired lease term (ie if your lease has 50 years left the statutory lease extension will provide a new term of 140 years). The intention of the valuation is to determine the sum payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold premises in Gwernaffield with more than 100 years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges merit it.
| 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. |
| Bank of Scotland | 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with procure Gwernaffield 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.
14 months ago Oliver, came perilously near to the eighty-year mark with the lease on his leasehold flat in Gwernaffield. Having bought his home 19 years previously, the lease term was of no importance. Thankfully, he recognised he would imminently be paying an inflated amount for a lease extension. Oliver arranged for a lease extension at the eleventh hour in July. Oliver and the freeholder ultimately agreed on the final figure of £5,500 . If he failed to meet the deadline, the premium would have gone up by a minimum £1,150.
Last January we were called by Mr and Mrs. I Alexander , who bought a one bedroom flat in Gwernaffield in October 2008. The dilemma was if we could approximate the price would be for a 90 year lease extension. Comparative homes in Gwernaffield with 100 year plus lease were valued around £210,000. The average amount of ground rent was £50 billed yearly. The lease expired in 2106. Given that there were 80 years as a residual term we approximated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 not including costs.
Dr Y Thomas moved into a one bedroom apartment in Gwernaffield in September 2000. The question was if we could shed any light on how much (roughly) compensation to the landlord would likely be to extend the lease by an additional years. Similar flats in Gwernaffield with 100 year plus lease were valued about £275,000. The average amount of ground rent was £45 invoiced monthly. The lease concluded on 16 October 2095. Given that there were 69 years left we estimated the compensation to the freeholder for the lease extension to be within £12,400 and £14,200 exclusive of costs.