Unfortunately that a Colwyn Bay residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the Colwyn Bay property prices.Where your lease has approximately 90 years left, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips under eighty years - otherwise a higher premium will be payable. Most flat owners in Colwyn Bay will be able to extend under the legislation; however a lawyer should be able to clarify if you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to follow once the process is instigated and you will need to be guided by your lawyer throughout the formalities.
Leasehold residencies in Colwyn Bay 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 to be gained by purchasing the freehold unless savings on ground rent and maintenance charges merit 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; |
| 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. |
| 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. |
Retaining our service will provide you better control over the value of your Colwyn Bay leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
14 months ago William, came seriously close to the 80-year threshold with the lease on his basement apartment in Colwyn Bay. Having bought his flat 18 years previously, the lease term was of no bearing. Luckily, he became aware that he would imminently be paying an escalated premium for a lease extension. William was able to extend his lease just under the wire in March. William and the landlord who owned the flat above subsequently agreed on a premium of £6,000 . If the lease had dropped lower than 80 years, the premium would have increased by a minimum £850.
In 2009 we were approached by Mr and Mrs. H González who, having purchased a one bedroom apartment in Colwyn Bay in June 2000. The question was if we could estimate the price could be to extend the lease by ninety years. Similar residencies in Colwyn Bay with a long lease were valued around £235,600. The average ground rent payable was £60 billed per annum. The lease ended on 4 May 2087. Considering the 62 years remaining we approximated the compensation to the freeholder to extend the lease to be within £21,900 and £25,200 plus legals.
Mr and Mrs. H Moreau bought a garden flat in Colwyn Bay in August 2005. The question was if we could estimate the price would be for a ninety year extension to my lease. Comparative flats in Colwyn Bay with an extended lease were in the region of £174,200. The average ground rent payable was £55 billed every twelve months. The lease terminated in 2076. Having 51 years left we approximated the premium to the landlord to extend the lease to be between £31,400 and £36,200 not including legals.