When it comes to residential leasehold premises in Rhiwbina, you are actually purchasing a right to live in a property for a set period of time. These days flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you should consider a lease extension sooner rather than later. The general rule is that the shorter the number of years is the cost of extending the lease gets disproportionately more expensive notably once there are fewer than eighty years remaining. Residents in Rhiwbina with a lease nearing 81 years unexpired should seriously consider extending it without delay. When the lease term has under eighty years outstanding, under the current legislation the landlord is entitled to calculate and levy a greater amount, based on a technical computation, strangely termed as “marriage value” which is due.
It is conventional wisdom that a residential leasehold with over one hundred years remaining is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 45 years left, the residence will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
The lawyers that we work with procure Rhiwbina 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 lawyer we work with provide it.
Two years ago Rory, came perilously close to the 80-year threshold with the lease on his studio apartment in Rhiwbina. In buying his flat two decades ago, the lease term was of minimal significance. by good luck, it dawned on him that he needed to take steps soon on a lease extension. Rory was able to extend his lease just ahead of time last January. Rory and the freeholder eventually agreed on a premium of £6,000 . If he had missed the deadline, the sum would have escalated by at least £1,000.
In 2013 we were e-mailed by Mrs J White who, having moved into a one bedroom flat in Rhiwbina in September 2004. We are asked if we could estimate the premium would be to extend the lease by an additional years. Comparable premises in Rhiwbina with 100 year plus lease were worth £205,000. The average amount of ground rent was £50 billed per annum. The lease finished in 2103. Taking into account 78 years outstanding we approximated the premium to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of fees.
Mr and Mrs. H Martinez acquired a ground floor flat in Rhiwbina in January 2004. We are asked if we could approximate the price would likely be for a 90 year lease extension. Comparable premises in Rhiwbina with an extended lease were worth £267,600. The mid-range ground rent payable was £65 collected annually. The lease finished in 2092. Having 67 years left we estimated the compensation to the freeholder for the lease extension to be within £14,300 and £16,400 plus legals.