Unfortunately that a Penllergaer residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Penllergaer property market.Where your lease has approximately ninety years left, you should start considering a lease extension. If the number of years remaining 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. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Penllergaer will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify whether you are eligibility. In some situations you may not qualify. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the formalities.
Leasehold premises in Penllergaer with in excess of one hundred years left 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 circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| 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; |
| 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Engaging our service will provide you increased control over the value of your Penllergaer leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
During the course of the last few months Archie, came seriously close to the eighty-year mark with the lease on his studio apartment in Penllergaer. In buying his flat two decades ago, the length of the lease was of little importance. Fortunately, he recognised he would imminently be paying way over the odds for a lease extension. Archie arranged for a lease extension just under the wire in May. Archie and the freeholder via the management company in the end agreed on an amount of £6,000 . If the lease had slid lower than eighty years, the amount would have increased by at least £1,100.
In 2013 we were phoned by Dr B Hill who, having completed a one bedroom apartment in Penllergaer in March 1999. We are asked if we could shed any light on how much (roughly) price would be for a ninety year extension to my lease. Similar residencies in Penllergaer with an extended lease were in the region of £275,000. The mid-range ground rent payable was £65 invoiced yearly. The lease ended on 3 August 2093. Considering the 68 years remaining we estimated the premium to the landlord for the lease extension to be within £13,300 and £15,400 exclusive of legals.
Dr Hunter Leroy moved into a ground floor flat in Penllergaer in September 1998. We are asked if we could approximate the premium would be for a ninety year extension to my lease. Identical premises in Penllergaer with 100 year plus lease were in the region of £213,600. The average amount of ground rent was £60 invoiced monthly. The lease end date was in 2082. Considering the 57 years outstanding we approximated the premium to the landlord to extend the lease to be within £30,400 and £35,200 exclusive of fees.