Gwernaffield leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. It is the case that most Gwernaffield tenants have the right to extend their lease by an additional 90 years in accordance with the 1993 Leasehold Reform Act. If you are a leasehold owner in Gwernaffield you would be well advised to check if your lease has between 70 and ninety years left. In particular once the remaining lease term slips under eighty years, the cost of any lease extension increases dramatically as part of the premium you will incur is what is known as a marriage value
Leasehold premises in Gwernaffield with in excess of 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth 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 |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 conveyancers that we work with undertake Gwernaffield 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 conveyancing solicitor we work with provide it.
Off the back of protracted correspondence with the freeholder of her one bedroom apartment in Gwernaffield, Lydia commenced the lease extension process as the 80 year deadline was rapidly coming. The transaction was finalised in February 2012. The landlord’s fees were kept to an absolute minimum.
Last Christmas we were approach by Mr P Hall , who acquired a one bedroom apartment in Gwernaffield in July 2004. We are asked if we could shed any light on how much (approximately) premium would likely be for a 90 year lease extension. Comparative homes in Gwernaffield with 100 year plus lease were valued about £174,200. The average ground rent payable was £55 collected per annum. The lease lapsed in 2075. Given that there were 51 years as a residual term we approximated the premium to the landlord for the lease extension to be between £31,400 and £36,200 plus expenses.
Ms B Stewart was assigned a lease of a one bedroom apartment in Gwernaffield in June 2007. We are asked if we could estimate the premium would be for a ninety year lease extension. Comparative flats in Gwernaffield with a long lease were in the region of £280,000. The average ground rent payable was £45 invoiced per annum. The lease expiry date was in 2095. Taking into account 71 years unexpired we calculated the compensation to the freeholder to extend the lease to be within £12,400 and £14,200 plus costs.