Llanfyrnach leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. It is the case that most Llanfyrnach tenants have the right to extend their lease by an additional ninety years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in Llanfyrnach you should check if your lease has between seventy and ninety years remaining. In particular once the remaining lease term slips under 80 years, the cost of any lease extension sharply increases as part of the premium you pay is what is known as a marriage value
Leasehold residencies in Llanfyrnach with over 100 years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
Irrespective of whether you are a tenant or a freeholder in Llanfyrnach,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Llanfyrnach valuers.
Liam owned a studio apartment in Llanfyrnach on the market with a lease of a little over 72 years unexpired. Liam informally approached his landlord being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent initially set at £100 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Liam to invoke his statutory right. Liam procured expert advice and secured satisfactory deal without resorting to tribunal and readily saleable.
Dr Sophie Norbert completed a one bedroom flat in Llanfyrnach in October 2009. The dilemma was if we could estimate the premium could be for a 90 year extension to my lease. Similar homes in Llanfyrnach with a long lease were in the region of £210,600. The average ground rent payable was £45 billed annually. The lease termination date was in 2088. Given that there were 62 years left we calculated the premium to the landlord for the lease extension to be within £18,100 and £20,800 plus fees.
Dr F Bennett purchased a ground floor apartment in Llanfyrnach in March 1998. We are asked if we could shed any light on how much (approximately) premium would be for a ninety year lease extension. Identical residencies in Llanfyrnach with a long lease were in the region of £265,000. The mid-range amount of ground rent was £50 collected monthly. The lease elapsed in 2099. Having 73 years left we approximated the premium to the landlord to extend the lease to be between £9,500 and £11,000 not including fees.