Owning a flat usually means owning a lease of the property, which has a finite term of years. This lease will usually be granted for a set period of time , ordinarily 99 or 125 years, although we have witnessed longer and shorter terms in Kidwelly. Inevitably, the term of lease left reduces over time. This is often overlooked and only becomes a problem when the flat or house needs to be sold or re-mortgaged. The shorter the lease the lower the value of the property and the more it will cost to extend the lease. Qualifying leaseholders in Kidwelly have the right to extend the lease for an additional 90 years under statute. Do give careful attention before putting off your Kidwelly lease extension. Holding off the cost now only increases the price you will ultimately incur to extend your lease
Leasehold residencies in Kidwelly with in excess of one hundred years outstanding on the lease are often 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 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
| 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. |
Retaining our service will provide you enhanced control over the value of your Kidwelly leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
In the wake of 6 months of protracted discussions with the freeholder of her leasehold flat in Kidwelly, Olivia initiated the lease extension process as the 80 year mark was rapidly coming. The legal work was concluded in July 2012. The freeholder’s charges were kept to an absolute minimum.
Dr Liam Clark completed a garden flat in Kidwelly in September 2011. We are asked if we could approximate the premium would be for a ninety year lease extension. Similar residencies in Kidwelly with an extended lease were valued around £265,000. The average amount of ground rent was £50 billed annually. The lease finished on 3 February 2098. Taking into account 73 years unexpired we estimated the premium to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of legals.
Last Christmas we were e-mailed by Dr B Smith , who owned a first floor flat in Kidwelly in April 1998. The dilemma was if we could approximate the compensation to the landlord could be for a ninety year lease extension. Comparable premises in Kidwelly with an extended lease were in the region of £264,000. The average ground rent payable was £60 collected monthly. The lease came to a finish on 26 June 2078. Having 53 years unexpired we calculated the compensation to the freeholder for the lease extension to be between £37,100 and £42,800 exclusive of costs.