Harlech leases on residential deteriorating in value. if your lease has in the region of ninety years unexpired, you should start considering the need for a lease extension. If lease term falls under eighty years, you will then be required to pay 50% of the property's 'marriage value' on top of the standard cost of the lease extension to your landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Flat owners in Harlech will usually be legally entitled to a lease extension; however it’s a good idea to check with a conveyancer to check if you qualify. In certain situations you may not qualify. There are prescribed deadlines and steps to follow once the process is initiated so it’s sensible to be guided by a conveyancing solicitor during the process.
It is generally considered that a property with more than 100 years remaining is worth roughly the same as a freehold. Where an additional ninety years added to any lease with more than 35 years left, the residence will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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 Harlech can be a difficult process. We recommend you secure guidance from a conveyancing solicitor and surveyor with experience in lease extensions.
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 Harlech lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
During the course of the last few months Rory, started to get near to the eighty-year mark with the lease on his basement apartment in Harlech. In buying his flat two decades ago, the length of the lease was of minimal interest. Fortunately, he noticed he would soon be paying an inflated amount for Extending the lease. Rory arranged for a lease extension just under the wire in April. Rory and the freeholder via the managing agents subsequently settled on a premium of £5,500 . If he failed to meet the deadline, the figure would have increased by at least £850.
In 2011 we were contacted by Mr and Mrs. G Harris who, having owned a first floor flat in Harlech in May 2003. We are asked if we could shed any light on how much (approximately) premium would likely be to extend the lease by 90 years. Comparable homes in Harlech with 100 year plus lease were in the region of £280,000. The average ground rent payable was £45 billed every twelve months. The lease concluded on 4 September 2096. Considering the 70 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 plus fees.
In 2012 we were approached by Mr and Mrs. U Richardson who, having took over the lease of a newly refurbished flat in Harlech in February 2004. The question was if we could estimate the price would likely be to extend the lease by an additional years. Comparative homes in Harlech with an extended lease were valued about £223,400. The mid-range ground rent payable was £60 collected every twelve months. The lease ended in 2085. Taking into account 59 years outstanding we approximated the premium to the landlord to extend the lease to be between £27,600 and £31,800 plus professional charges.