Unfortunately that a Usk residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the first few years due to the reduction being disguised by increases in the Usk property prices.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. If the number of years remaining falls under 80 years, you will end up paying half of the property's 'marriage value' on top of 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 Usk will be able to extend under the legislation; however a conveyancer should be able to confirm if you are eligibility. In some situations you may not qualify. 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 conveyancer throughout the formalities.
It is conventional wisdom that a residential leasehold with over one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| 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. |
| 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. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
Irrespective of whether you are a tenant or a landlord in Usk,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 in-depth market knowledge and the close ties they enjoy with Usk valuers.
Last Spring Kian, started to get close to the eighty-year threshold with the lease on his two bedroom flat in Usk. Having purchased his home twenty years ago, the length of the lease was of little concern. Fortunately, it dawned on him that he needed to take steps soon on a lease extension. Kian was able to extend his lease just under the wire last March. Kian and the landlord who owned the flat above subsequently settled on the final figure of £5,500 . If the lease had gone below 80 years, the price would have gone up by at least £975.
In 2009 we were phoned by Mr and Mrs. Y Young who, having moved into a studio apartment in Usk in January 1999. The question was if we could approximate the premium could be for a ninety year lease extension. Identical premises in Usk with a long lease were valued around £255,000. The average amount of ground rent was £50 invoiced every twelve months. The lease expiry date was on 8 September 2096. Having 71 years left we approximated the premium to the landlord to extend the lease to be within £9,500 and £11,000 plus legals.
Mr and Mrs. W Dupont moved into a studio apartment in Usk in November 2012. The question was if we could shed any light on how much (roughly) price would likely be for a 90 year extension to my lease. Similar homes in Usk with 100 year plus lease were worth £254,200. The mid-range amount of ground rent was £60 invoiced monthly. The lease finished on 19 February 2076. Taking into account 51 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £43,700 and £50,600 plus expenses.