The market value of a leasehold property in Llandovery is impacted by how long the lease has left to run. If it is near to or fewer than eighty years you should envisage problems on re-sale, so it is advisable to arrange for a lease extension ahead of purchasing. It is ideal to start the process of extending the lease is when the lease still has 82 years remaining so that formalities can be concluded in advance of the 80 year cut off point. Current legislation enables Llandovery qualifying lessees to an additional term of ninety years over and above the existing term, at a peppercorn rent (zero ground rent). The purpose of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years remaining, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Leeds Building Society | 85 years remaining from the start 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. |
The conveyancers that we work with procure Llandovery 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 lengthy negotiations with the freeholder of her first floor flat in Llandovery, Sian started the lease extension process just as the lease was approaching the all-important eighty-year threshold. The legal work was concluded in August 2008. The landlord’s fees were kept to an absolute minimum.
In 2009 we were e-mailed by Ms Aimee Martin who, having took over the lease of a one bedroom flat in Llandovery in August 2012. We are asked if we could estimate the price would likely be to extend the lease by 90 years. Comparative flats in Llandovery with an extended lease were worth £201,200. The mid-range amount of ground rent was £55 billed every twelve months. The lease finished on 15 February 2081. Having 56 years left we approximated the compensation to the landlord for the lease extension to be between £31,400 and £36,200 exclusive of professional charges.
Mr and Mrs. O Lewis moved into a one bedroom flat in Llandovery in January 2004. The dilemma was if we could approximate the premium would likely be to extend the lease by an additional years. Comparative properties in Llandovery with an extended lease were valued about £300,000. The mid-range amount of ground rent was £50 invoiced yearly. The lease expired in 2101. Having 76 years left we calculated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 not including professional charges.