The re-sale value of a leasehold property in Hengoed depends on how long the lease has left to run. If it is near to or less than 80 years you should expect problems on re-sale, so it is recommended to arrange for a lease extension prior to buying. It is ideal to start the lease extension process when a lease still has 82 years remaining so that formalities can be finalised in advance of the 80 year cut off point. Current legislation enables Hengoed qualifying lessees to acquire a new lease which will be for the current unexpired lease term plus an additional term of ninety years. The purpose of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold residencies in Hengoed with over 100 years remaining on the lease are often 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 buying the freehold unless savings on ground rent and estate charges justify 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with handle Hengoed 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.
Jonathan owned a high value apartment in Hengoed being marketed with a lease of fraction over fifty eight years left. Jonathan informally contacted his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £50 annually. Ordinarily, ground rent would not be due on a lease extension were Jonathan to invoke his statutory right. Jonathan obtained expert advice and was able to make a more informed decision and handle with the matter and readily saleable.
Dr Robyn Flores was assigned a lease of a first floor flat in Hengoed in January 2002. We are asked if we could estimate the compensation to the landlord would be for a ninety year extension to my lease. Similar flats in Hengoed with a long lease were worth £183,600. The mid-range ground rent payable was £65 invoiced every twelve months. The lease ran out on 6 January 2083. Given that there were 57 years remaining we calculated the premium to the landlord to extend the lease to be within £28,500 and £33,000 not including legals.
Mr and Mrs. N Pérez owned a one bedroom flat in Hengoed in June 2006. We are asked if we could approximate the price would be for a ninety year extension to my lease. Comparable properties in Hengoed with an extended lease were worth £245,000. The mid-range ground rent payable was £50 collected per annum. The lease expiry date was on 16 January 2094. Taking into account 68 years left we calculated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 not including fees.