When it comes to residential leasehold premises in Colwyn Bay, you are in fact renting it for a certain period of time. Modern flat leases typically tend to be for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you may consider extending the lease sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly notably when there are fewer than eighty years left. Anyone in Colwyn Bay with a lease drawing near to 81 years remaining should seriously think of extending it sooner rather than later. When a lease has under 80 years outstanding, under the current Act the landlord can calculate and demand a greater premium, based on a technical computation, known as “marriage value” which is due.
Leasehold premises in Colwyn Bay with in excess of 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with handle Colwyn Bay 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.
Muhammad was the the leasehold owner of a high value flat in Colwyn Bay being marketed with a lease of just over fifty eight years left. Muhammad on an informal basis approached his freeholder a well known Manchester-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a new rent initially set at £150 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Muhammad to exercise his statutory right. Muhammad obtained expert legal guidance and was able to make a more informed decision and deal with the matter and sell the flat.
In 2009 we were contacted by Mr and Mrs. P Davies who, having was assigned a lease of a garden apartment in Colwyn Bay in September 2004. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be to prolong the lease by an additional years. Comparative premises in Colwyn Bay with a long lease were valued around £208,600. The mid-range amount of ground rent was £60 billed per annum. The lease termination date was in 2083. Taking into account 57 years outstanding we estimated the compensation to the landlord to extend the lease to be within £30,400 and £35,200 plus costs.
Last month we were approach by Mr H Michel , who bought a basement flat in Colwyn Bay in September 1996. The dilemma was if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Comparative flats in Colwyn Bay with an extended lease were valued about £200,000. The average ground rent payable was £50 invoiced annually. The lease termination date was in 2103. Having 77 years unexpired we estimated the compensation to the landlord for the lease extension to be between £8,600 and £9,800 exclusive of fees.