The re-sale value of a leasehold property in Rumney is impacted by how long the lease has left to run. If it is close to or less than 80 years you should foresee difficulties on re-sale, so it is advisable to arrange for the lease to be extended ahead of buying. It is preferable to commence the process of extending the lease is when the lease still has 82 years to run so that a lease extension can be addressed prior to the 80 year mark. Current legislation entitles Rumney qualifying lessees to acquire a new lease which will be for the current unexpired lease term plus a further term of 90 years. The purpose of the valuation is to determine the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold residencies in Rumney with in excess of 100 years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges justify it.
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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 Rumney,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Rumney valuers.
Last October David, came very close to the eighty-year threshold with the lease on his first floor apartment in Rumney. In buying his flat twenty years previously, the unexpired term was of little importance. Thankfully, he noticed he would soon be paying way over the odds for a lease extension. David extended the lease just ahead of time in September. David and the landlord who owned the flat above subsequently agreed on sum of £5,500 . If the lease had fallen lower than eighty years, the figure would have increased by a minimum £1,000.
Dr Benjamin Edwards bought a basement apartment in Rumney in November 2009. We are asked if we could estimate the price would be to prolong the lease by a further 90 years. Identical properties in Rumney with a long lease were in the region of £225,800. The average ground rent payable was £60 invoiced quarterly. The lease lapsed on 22 January 2086. Having 60 years as a residual term we approximated the premium to the freeholder for the lease extension to be between £23,800 and £27,400 plus legals.
Last month we were approach by Dr Adam Gómez , who owned a purpose-built apartment in Rumney in July 2006. The dilemma was if we could approximate the premium would be for a ninety year lease extension. Comparative properties in Rumney with a long lease were worth £210,000. The mid-range amount of ground rent was £50 collected monthly. The lease came to a finish in 2106. Given that there were 80 years unexpired we estimated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 exclusive of fees.