Pentyrch residential property owned on a long lease is a depreciating asset because a leaseholder only owns the property for a set term.
It is generally accepted that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 |
Irrespective of whether you are a tenant or a freeholder in Pentyrch,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Pentyrch valuers.
After lengthy correspondence with the freeholder of her garden apartment in Pentyrch, Kelsey commenced the lease extension process as the 80 year deadline was swiftly advancing. The legal work was concluded in July 2015. The landlord’s fees were restricted to a tad over four hundred pounds.
Mr and Mrs. P Nelson bought a basement flat in Pentyrch in August 2008. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to extend the lease by a further 90 years. Identical residencies in Pentyrch with an extended lease were worth £208,200. The average ground rent payable was £65 invoiced every twelve months. The lease ended on 14 November 2087. Taking into account 61 years as a residual term we calculated the compensation to the landlord to extend the lease to be between £20,000 and £23,000 exclusive of expenses.
In 2009 we were contacted by Mr and Mrs. C Stewart who, having bought a one bedroom apartment in Pentyrch in November 2011. The question was if we could approximate the compensation to the landlord could be for a 90 year lease extension. Comparable flats in Pentyrch with an extended lease were in the region of £260,000. The average ground rent payable was £50 collected annually. The lease terminated in 2098. Having 72 years remaining we estimated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 not including expenses.