Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will ordinarily be granted for a prescribed period of time , ordinarily 99 or 125 years, although we have come across longer and shorter terms in Tredegar. Inevitably, the length of lease remaining shortens over time. This is often overlooked and only raises itself as an issue when the flat or house has to be disposed of or re-mortgaged. The fewer the years remaining the less it is worth and the more expensive it will be to extend the lease. Eligible leaseholders in Tredegar have the legal entitlement to extend the lease for a further 90 years under legislation. Do give due deliberation before delaying your Tredegar lease extension. Putting off the cost now only increases the price you will ultimately incur to extend your lease
Leasehold residencies in Tredegar with over 100 years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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:
|
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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 handle Tredegar 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 conveyancer we work with provide it.
Nathan owned a studio apartment in Tredegar on the market with a lease of fraction over 72 years remaining. Nathan on an informal basis spoke with his landlord a well known Manchester-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent to start with set at £200 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Nathan to exercise his statutory right. Nathan obtained expert advice and secured satisfactory deal without resorting to tribunal and ending up with a market value flat.
In 2011 we were phoned by Mr and Mrs. R Gómez who, having completed a one bedroom flat in Tredegar in November 2002. We are asked if we could approximate the compensation to the landlord would likely be to extend the lease by an additional years. Similar homes in Tredegar with an extended lease were in the region of £189,000. The mid-range amount of ground rent was £55 billed per annum. The lease came to a finish in 2079. Considering the 53 years as a residual term we estimated the compensation to the landlord for the lease extension to be within £28,500 and £33,000 exclusive of professional charges.
In 2010 we were contacted by Mr and Mrs. Y Bennett who, having completed a garden apartment in Tredegar in April 2010. The question was if we could approximate the compensation to the landlord could be for a ninety year extension to my lease. Similar properties in Tredegar with an extended lease were valued around £290,000. The average ground rent payable was £45 collected annually. The lease expired on 24 July 2099. Considering the 73 years as a residual term we approximated the premium to the landlord to extend the lease to be between £9,500 and £11,000 not including professional charges.