There is no doubt about it a leasehold flat or house in Mountain Ash is a wasting asset as a result of the diminishing lease term. If the lease has, over one hundred years to run then this decrease may be fractional however there will become a stage when a lease has fewer than 80 years left as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the primary reason why you should extend the lease without delay. Many flat owners in Mountain Ash will qualify for this right; that being said a lawyer will be able to advise whether you qualify to extend your lease. In certain situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
It is generally considered that a property with in excess of 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Coventry Building Society | 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. |
| National Westminster Bank | 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. |
Engaging our service gives you better control over the value of your Mountain Ash 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 are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Logan owned a high value flat in Mountain Ash being sold with a lease of just over 61 years unexpired. Logan on an informal basis spoke with his landlord a well known local-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 £200 per annum and increase every 25 years thereafter. No ground rent would be payable on a lease extension were Logan to exercise his statutory right. Logan obtained expert legal guidance and was able to make an informed judgement and handle with the matter and sell the property.
Last year we were e-mailed by Ms Sophie Hall , who completed a first floor flat in Mountain Ash in October 1998. We are asked if we could approximate the premium could be to extend the lease by an additional years. Identical properties in Mountain Ash with 100 year plus lease were in the region of £218,000. The mid-range amount of ground rent was £45 invoiced quarterly. The lease lapsed on 10 July 2088. Having 63 years as a residual term we estimated the premium to the landlord for the lease extension to be within £17,100 and £19,800 exclusive of fees.
Dr Sophie Simon took over the lease of a studio apartment in Mountain Ash in September 2000. The dilemma was if we could approximate the price would be to prolong the lease by a further 90 years. Similar premises in Mountain Ash with 100 year plus lease were worth £265,000. The mid-range amount of ground rent was £55 collected quarterly. The lease elapsed on 26 April 2099. Having 74 years left we estimated the premium to the landlord to extend the lease to be between £9,500 and £11,000 not including expenses.