The closer a residential lease in Sketty nears to zero years unexpired, the more it reduces the value of the property. If the lease has, over 99 years to run then this decrease may be negligible nevertheless there will become a point in time when a lease has less than 80 years remaining as part of the premium you will incur is what is termed as a marriage value. This could be significant. It is the main rational as to why you should extend the lease sooner than later. The majority of flat owners in Sketty will qualify for this right; that being said a conveyancer can confirm if you are eligible for a lease extension. In limited situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
It is generally accepted that a residential leasehold with more than one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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 | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 lawyers that we work with procure Sketty 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.
Subsequent to lengthy negotiations with the landlord of her first floor apartment in Sketty, Kelsey initiated the lease extension process as the 80 year deadline was rapidly coming. The lease extension was finalised in February 2012. The freeholder’s fees were negotiated to approximately four hundred GBP.
Last Autumn we were called by Dr Katie Young , who took over the lease of a purpose-built flat in Sketty in June 2001. The question was if we could shed any light on how much (approximately) compensation to the landlord would likely be for a ninety year extension to my lease. Comparable premises in Sketty with an extended lease were in the region of £216,000. The mid-range amount of ground rent was £60 invoiced every twelve months. The lease elapsed in 2084. Considering the 58 years unexpired we estimated the premium to the landlord to extend the lease to be between £28,500 and £33,000 exclusive of costs.
In 2010 we were called by Mr K Anderson who, having acquired a studio flat in Sketty in November 2012. The question was if we could estimate the premium would likely be to extend the lease by an additional years. Similar homes in Sketty with a long lease were in the region of £205,000. The mid-range amount of ground rent was £50 collected every twelve months. The lease ended on 15 February 2104. Given that there were 78 years outstanding we approximated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 plus professional charges.