Unfortunately that a Ponthir residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the first few years due to the depreciation being disguised by increases in the Ponthir property market.Where your lease has approximately ninety years left, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips under eighty years - otherwise a higher premium will be payable. Most flat owners in Ponthir will be able to extend under the legislation; however a lawyer should be able to confirm whether you qualify for an extension. In some situations you may not be entitled. There are also strict timetables and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancing solicitor throughout the formalities.
It is generally accepted that a residential leasehold with over one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be equivalent in value to 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with procure Ponthir lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancing solicitor we work with provide it.
After lengthy discussions with the landlord of her leasehold apartment in Ponthir, Lauren initiated the lease extension process as the eighty year mark was rapidly approaching. The legal work was concluded in July 2011. The freeholder’s costs were kept to an absolute minimum.
In 2011 we were contacted by Dr Megan Collins who, having bought a newly refurbished flat in Ponthir in May 2005. We are asked if we could estimate the price could be for a ninety year lease extension. Identical residencies in Ponthir with a long lease were valued about £198,400. The average ground rent payable was £65 invoiced yearly. The lease termination date was in 2085. Having 59 years outstanding we approximated the compensation to the landlord for the lease extension to be between £21,900 and £25,200 not including expenses.
Last Summer we were e-mailed by Mr and Mrs. D Patel , who bought a one bedroom apartment in Ponthir in October 2008. We are asked if we could estimate the price would likely be for a 90 year extension to my lease. Similar residencies in Ponthir with an extended lease were valued about £255,000. The mid-range ground rent payable was £50 billed monthly. The lease concluded on 10 September 2096. Considering the 70 years unexpired we approximated the compensation to the landlord to extend the lease to be between £9,500 and £11,000 plus expenses.