The market value of Gwernaffield leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can increase significantly once the unexpired lease term is below than 80 years
Leasehold properties in Gwernaffield with in excess of one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| 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. |
Engaging our service gives you enhanced control over the value of your Gwernaffield leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Reuben owned a conversion flat in Gwernaffield being marketed with a lease of fraction over 59 years outstanding. Reuben informally contacted his freeholder being a well known Bristol-based freehold company for a lease extension. The landlord was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent initially set at £150 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Reuben to exercise his statutory right. Reuben obtained expert advice and was able to make a more informed judgement and deal with the matter and ending up with a market value flat.
Dr M Morel bought a one bedroom flat in Gwernaffield in September 1996. We are asked if we could shed any light on how much (approximately) price would be for a 90 year lease extension. Comparative flats in Gwernaffield with a long lease were in the region of £198,800. The mid-range amount of ground rent was £55 invoiced annually. The lease expired in 2081. Taking into account 55 years remaining we calculated the compensation to the landlord for the lease extension to be between £33,300 and £38,400 plus expenses.
Last Summer we were approach by Mr H Jones , who was assigned a lease of a garden flat in Gwernaffield in March 1998. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be to prolong the lease by a further 90 years. Comparable premises in Gwernaffield with an extended lease were worth £295,000. The mid-range ground rent payable was £50 invoiced per annum. The lease ended on 15 April 2101. Given that there were 75 years unexpired we approximated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 plus expenses.