Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will normally be granted for a fixed period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Towyn. Inevitably, the term of lease left shortens as time goes by. This may slip by relatively unnoticed when the property 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 leaseholders in Towyn have the right to extend the lease for an additional 90 years in accordance with statute. Do give careful consideration before putting off your Towyn lease extension. Putting off that expense now likely increases the price you will eventually incur for a lease extension
Leasehold residencies in Towyn with over one hundred years unexpired 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 purchasing the reversionary interest unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| 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 | 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 |
| 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 freeholder in Towyn,the lease extension lawyers 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 Towyn valuers.
Kian was the the leasehold proprietor of a 2 bedroom flat in Towyn on the market with a lease of fraction over 61 years left. Kian informally spoke with his landlord being a well known Bristol-based freehold company for a lease extension. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £125 per annum. Ordinarily, ground rent would not be due on a lease extension were Kian to invoke his statutory right. Kian obtained expert legal guidance and was able to make an informed decision and handle with the matter and readily saleable.
Mr S White completed a one bedroom apartment in Towyn in January 2012. We are asked if we could shed any light on how much (approximately) premium could be for a ninety year lease extension. Comparative premises in Towyn with 100 year plus lease were worth £280,000. The average amount of ground rent was £55 invoiced per annum. The lease finished in 2105. Taking into account 79 years as a residual term we estimated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of costs.
Last Spring we were phoned by Dr Milo Wright , who moved into a one bedroom flat in Towyn in July 1998. The question was if we could estimate the premium would be to prolong the lease by ninety years. Comparative flats in Towyn with 100 year plus lease were worth £191,000. The mid-range ground rent payable was £65 billed every twelve months. The lease terminated on 13 October 2084. Given that there were 58 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £23,800 and £27,400 plus professional charges.