Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. This lease will usually be granted for a prescribed period of time , ordinarily 99 or 125 years, although we have come across longer and shorter terms in Tonypandy. Inevitably, the period of lease remaining shortens as time goes by. This may pass by relatively unnoticed when the flat or house has to be sold or re-mortgaged. The fewer the years remaining the less it is worth and the more it will cost to extend the lease. Qualifying long lease owners in Tonypandy have the right to extend the lease for an additional 90 years under Leasehold Reform legislation. You should give due consideration before delaying your Tonypandy lease extension. Holding off that expense now likely increases the price you will eventually incur to extend your lease
It is conventional wisdom that a property with over 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years remaining, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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 30 years plus the term of the mortgage at the outset of the mortgage. |
| 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. |
| 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 |
| 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. |
Regardless of whether you are a tenant or a freeholder in Tonypandy,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Tonypandy valuers.
Half a year ago Ben, came seriously close to the eighty-year threshold with the lease on his ground floor apartment in Tonypandy. In buying his home two decades ago, the length of the lease was of little interest. by good luck, he realised he needed to take action soon on Extending the lease. Ben extended the lease just ahead of time in June. Ben and the freeholder via the managing agents eventually agreed on sum of £5,000 . If he failed to meet the deadline, the amount would have escalated by a minimum £850.
Last Christmas we were phoned by Ms B Rivera , who owned a one bedroom apartment in Tonypandy in May 2003. The dilemma was if we could approximate the premium would be to extend the lease by ninety years. Identical premises in Tonypandy with 100 year plus lease were worth £246,800. The average amount of ground rent was £60 billed monthly. The lease terminated in 2076. Taking into account 50 years outstanding we calculated the premium to the freeholder to extend the lease to be between £44,700 and £51,600 exclusive of professional charges.
Ms T Wilson moved into a ground floor flat in Tonypandy in May 2001. The question was if we could estimate the premium would likely be to extend the lease by an additional years. Comparative flats in Tonypandy with 100 year plus lease were valued about £203,200. The average ground rent payable was £65 invoiced annually. The lease came to a finish on 20 February 2087. Taking into account 61 years left we calculated the compensation to the landlord for the lease extension to be between £19,000 and £22,000 plus fees.