For anyone whose Hirwaun property is held on a long lease, our message is clear – if you ignore the situation, the property will eventually revert to your landlord, leaving you empty-handed. The shorter the lease the lower the value of the property and the more it will cost to procure a lease extension.
It is generally considered that a property with more than one hundred years remaining is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Engaging our service gives you enhanced control over the value of your Hirwaun leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Alex was the the leasehold owner of a high value flat in Hirwaun on the market with a lease of a few days over sixty years left. Alex on an informal basis spoke with his freeholder a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a rise in the rent to £100 annually. No ground rent would be payable on a lease extension were Alex to invoke his statutory right. Alex procured expert legal guidance and secured satisfactory resolution without going to tribunal and ending up with a market value flat.
Last Winter we were e-mailed by Dr Lewis White , who took over the lease of a one bedroom flat in Hirwaun in March 2000. We are asked if we could estimate the price would likely be for a 90 year extension to my lease. Comparative flats in Hirwaun with a long lease were in the region of £265,000. The average amount of ground rent was £50 invoiced quarterly. The lease elapsed on 10 September 2099. Having 74 years as a residual term we estimated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 not including costs.
In 2009 we were called by Dr Isaac López who, having owned a garden apartment in Hirwaun in June 2004. The dilemma was if we could shed any light on how much (approximately) price could be to extend the lease by an additional years. Comparative properties in Hirwaun with an extended lease were worth £166,400. The mid-range amount of ground rent was £60 billed annually. The lease ended on 22 March 2079. Having 54 years unexpired we calculated the premium to the landlord for the lease extension to be within £32,300 and £37,400 plus costs.