Unfortunately that a Porth 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 depreciation being disguised by increases in the Porth property prices.Where your lease has approximately ninety years left, you should start thinking about 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 lower than eighty years - otherwise a higher premium will be due. The majority of leasehold owners in Porth will be able to extend under the legislation; however a lawyer should be able to clarify whether you qualify for an extension. In some situations you may not qualify. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer from beginning to end of the process.
Leasehold premises in Porth with over one hundred years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| Yorkshire 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. |
Using our service gives you enhanced control over the value of your Porth leasehold, as your property will be more valuable and marketable in terms of lease length should you want 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.
During the course of the last few months Harry, came dangerously near to the 80-year threshold with the lease on his two bedroom apartment in Porth. Having bought his home 18 years ago, the lease term was of little bearing. As luck would have it, he realised he needed to take steps soon on Extending the lease. Harry arranged for a lease extension at the eleventh hour in June. Harry and the landlord ultimately settled on a premium of £6,000 . If he failed to meet the deadline, the amount would have gone up by at least £950.
In 2011 we were phoned by Dr Henry Parker who, having completed a one bedroom flat in Porth in October 1999. We are asked if we could approximate the compensation to the landlord would be to extend the lease by an additional years. Identical properties in Porth with an extended lease were valued about £285,000. The mid-range ground rent payable was £45 collected monthly. The lease came to a finish on 4 October 2097. Considering the 72 years outstanding we estimated the premium to the freeholder to extend the lease to be within £12,400 and £14,200 plus professional charges.
In 2014 we were e-mailed by Mr Cameron Cox who, having completed a ground floor flat in Porth in March 2004. We are asked if we could estimate the premium would be to prolong the lease by a further 90 years. Comparative flats in Porth with an extended lease were valued around £233,200. The average ground rent payable was £60 invoiced yearly. The lease lapsed in 2086. Considering the 61 years outstanding we calculated the premium to the freeholder to extend the lease to be between £22,800 and £26,400 not including costs.