It’s an underpublicised certainty that a Old Colwyn residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Old Colwyn property market.Once your lease gets to 85ish years, you should start considering a lease extension. If lease term falls under 80 years, you will end up paying 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property The majority of flat owners in Old Colwyn will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify whether you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
It is conventional wisdom that a property with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 30 years remaining, 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 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Old Colwyn can be a difficult process. We recommend you secure guidance from a conveyancer and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring Old Colwyn lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Following unsuccessful correspondence with the freeholder of her studio flat in Old Colwyn, Yasmin commenced the lease extension process as the 80 year mark was rapidly coming. The legal work was concluded in March 2012. The landlord’s costs were kept to an absolute minimum.
In 2014 we were contacted by Mr and Mrs. Y Gunderson who, having owned a purpose-built flat in Old Colwyn in February 1998. We are asked if we could approximate the premium would be to prolong the lease by a further 90 years. Comparative residencies in Old Colwyn with a long lease were worth £227,800. The average amount of ground rent was £45 collected annually. The lease concluded on 1 January 2091. Given that there were 65 years left we approximated the premium to the landlord to extend the lease to be between £13,300 and £15,400 not including costs.
Last Christmas we were contacted by Mr and Mrs. W Rodríguez , who completed a studio apartment in Old Colwyn in February 2011. The dilemma was if we could approximate the price would be for a ninety year extension to my lease. Comparable properties in Old Colwyn with 100 year plus lease were in the region of £275,000. The mid-range ground rent payable was £55 invoiced monthly. The lease finished on 27 May 2102. Given that there were 76 years unexpired we estimated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 plus fees.