The value of Rumney leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can escalate significantly once the unexpired lease term is less than eighty years
Leasehold properties in Rumney with more than 100 years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little upside in purchasing the freehold unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| 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. |
| 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. |
The conveyancers that we work with undertake Rumney 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 conveyancer we work with provide it.
In the wake of 9 months of lengthy negotiations with the landlord of her purpose-built apartment in Rumney, Lauren commenced the lease extension process as the 80 year deadline was quickly nearing. The lease extension was concluded in March 2008. The landlord’s charges were restricted to about 550 pounds.
Mr W Jones moved into a ground floor flat in Rumney in July 2004. The dilemma was if we could shed any light on how much (roughly) premium would be to extend the lease by 90 years. Comparative premises in Rumney with a long lease were in the region of £181,600. The average amount of ground rent was £55 collected quarterly. The lease terminated on 12 May 2078. Considering the 52 years as a residual term we calculated the premium to the landlord to extend the lease to be between £30,400 and £35,200 not including legals.
Last year we were called by Mr Leo François , who completed a one bedroom apartment in Rumney in February 1996. The dilemma was if we could approximate the price could be for a 90 year extension to my lease. Identical residencies in Rumney with 100 year plus lease were in the region of £285,000. The average ground rent payable was £45 billed annually. The lease ended on 14 October 2098. Considering the 72 years unexpired we estimated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of fees.