It’s a harsh certainty that a Tonypandy residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Tonypandy property prices.Where your lease has approximately 90 years left, you should start considering a lease extension. If the number of years remaining drops under eighty years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of leasehold owners in Tonypandy will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify whether you are eligibility. In some situations you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the formalities.
Leasehold properties in Tonypandy with in excess of one hundred years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service gives you better control over the value of your Tonypandy leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Trailing lengthy discussions with the landlord of her two bedroom apartment in Tonypandy, Olivia commenced the lease extension process just as her lease was coming close to the crucial 80-year threshold. The legal work was finalised in June 2009. The freeholder’s charges were negotiated to approximately 450 GBP.
Mr and Mrs. B Morel took over the lease of a garden flat in Tonypandy in March 1999. The question was if we could approximate the price would likely be to prolong the lease by ninety years. Similar flats in Tonypandy with an extended lease were worth £237,600. The average ground rent payable was £45 billed yearly. The lease terminated in 2092. Considering the 67 years left we approximated the compensation to the freeholder to extend the lease to be between £11,400 and £13,200 exclusive of expenses.
In 2012 we were approached by Mr and Mrs. T Lambert who, having was assigned a lease of a ground floor apartment in Tonypandy in August 2011. The question was if we could estimate the premium would be to prolong the lease by 90 years. Similar premises in Tonypandy with a long lease were in the region of £280,000. The average amount of ground rent was £55 invoiced monthly. The lease end date was on 28 August 2103. Considering the 78 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 not including expenses.