Llanbedrog leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. Most owners of residential leasehold property in Llanbedrog enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Llanbedrog you would be well advised to check if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under eighty years, the cost of any lease extension increases dramatically as part of the premium you will incur is what is known as a marriage value
It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years in the future.
| 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. |
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
The conveyancers that we work with undertake Llanbedrog 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.
Off the back of protracted discussions with the landlord of her ground floor apartment in Llanbedrog, Alicia initiated the lease extension process just as the lease was approaching the all-important eighty-year threshold. The legal work was finalised in March 2014. The landlord’s fees were kept to an absolute minimum.
Last month we were called by Mr and Mrs. W Vincent , who was assigned a lease of a ground floor apartment in Llanbedrog in November 2001. The question was if we could estimate the premium would be for a 90 year extension to my lease. Similar flats in Llanbedrog with 100 year plus lease were valued around £205,000. The mid-range amount of ground rent was £50 invoiced monthly. The lease terminated on 25 October 2104. Given that there were 78 years remaining we calculated the compensation to the landlord for the lease extension to be within £8,600 and £9,800 exclusive of legals.
Last Christmas we were approach by Mr A Davis , who took over the lease of a studio flat in Llanbedrog in July 1995. We are asked if we could estimate the price could be for a ninety year extension to my lease. Identical residencies in Llanbedrog with an extended lease were worth £267,600. The mid-range ground rent payable was £65 billed annually. The lease ran out on 21 September 2093. Having 67 years as a residual term we estimated the premium to the landlord for the lease extension to be within £14,300 and £16,400 exclusive of expenses.