The value of Llanfairpwllgwyngyll leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can escalate substantially once the unexpired lease term is less than 80 years
It is generally considered that a property with more than 100 years remaining is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
The conveyancing solicitors that we work with handle Llanfairpwllgwyngyll 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 conveyancing solicitor we work with provide it.
Off the back of protracted negotiations with the landlord of her one bedroom apartment in Llanfairpwllgwyngyll, Niamh started the lease extension process as the 80 year mark was fast advancing. The legal work was concluded in February 2005. The landlord’s fees were restricted to below 650 pounds.
Mr and Mrs. W Thompson acquired a first floor apartment in Llanfairpwllgwyngyll in March 1995. We are asked if we could approximate the price would likely be to extend the lease by ninety years. Identical flats in Llanfairpwllgwyngyll with an extended lease were in the region of £275,000. The average amount of ground rent was £55 collected quarterly. The lease lapsed in 2101. Given that there were 76 years as a residual term we estimated the premium to the landlord for the lease extension to be within £9,500 and £11,000 not including costs.
Last Autumn we were called by Mr and Mrs. I Baker , who purchased a ground floor flat in Llanfairpwllgwyngyll in August 2007. The question was if we could approximate the premium would be to prolong the lease by 90 years. Similar residencies in Llanfairpwllgwyngyll with 100 year plus lease were valued about £176,200. The mid-range amount of ground rent was £65 billed per annum. The lease lapsed on 9 April 2081. Considering the 56 years unexpired we approximated the compensation to the freeholder for the lease extension to be between £29,500 and £34,000 exclusive of expenses.