The market value of Tonypandy 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 substantially once the unexpired lease term is less than 80 years
It is conventional wisdom that a property with more than 100 years remaining is worth roughly the same as a freehold. Where an additional 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
Irrespective of whether you are a tenant or a landlord in Tonypandy,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 Tonypandy valuers.
In the wake of 6 months of protracted negotiations with the landlord of her one bedroom flat in Tonypandy, Ellie initiated the lease extension process just as her lease was approaching the crucial 80-year mark. The legal work was concluded in January 2012. The landlord’s charges were restricted to about five hundred pounds.
Last month we were phoned by Mrs Jasmine Morel , who was assigned a lease of a one bedroom apartment in Tonypandy in May 2002. We are asked if we could shed any light on how much (roughly) premium would be to extend the lease by ninety years. Comparable properties in Tonypandy with an extended lease were in the region of £168,800. The average ground rent payable was £60 billed yearly. The lease expired in 2081. Taking into account 55 years left we estimated the compensation to the landlord for the lease extension to be within £30,400 and £35,200 plus legals.
In 2010 we were approached by Mr Gabriel Morgan who, having bought a studio flat in Tonypandy in August 1995. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord would likely be for a ninety year lease extension. Comparative flats in Tonypandy with a long lease were in the region of £235,200. The average amount of ground rent was £45 collected every twelve months. The lease expired on 21 August 2092. Taking into account 66 years outstanding we estimated the premium to the landlord for the lease extension to be between £12,400 and £14,200 not including expenses.