The market value of a leasehold property in Llandudno is impacted by how long the lease has left to run. If it is close to or less than eighty years you should anticipate difficulties on re-sale, so it is advisable to arrange for a lease extension prior to buying. It is preferable to commence the process of extending the lease is when a lease still has 82 years to run so that all matters can be concluded in advance of the 80 year mark. Statute entitles Llandudno qualifying lessees to acquire a new lease which will be for the balance of the existing lease plus a supplemental term of ninety years. The purpose of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold premises in Llandudno with in excess of one hundred years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with handle Llandudno 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.
Last October Jacob, came dangerously close to the 80-year mark with the lease on his purpose- built flat in Llandudno. In buying his property two decades ago, the unexpired term was of minimal bearing. by good luck, he realised he needed to take action soon on Extending the lease. Jacob was able to extend his lease just under the wire last June. Jacob and the landlord in the end settled on an amount of £5,000 . If the lease had slipped to less than eighty years, the figure would have become more exhorbitant by at least £950.
In 2009 we were contacted by Dr Rachael Bonnet who, having purchased a one bedroom apartment in Llandudno in May 2007. We are asked if we could estimate the premium would likely be for a ninety year extension to my lease. Comparable residencies in Llandudno with an extended lease were worth £295,000. The mid-range amount of ground rent was £45 invoiced every twelve months. The lease lapsed on 2 May 2099. Taking into account 74 years unexpired we approximated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 exclusive of costs.
In 2010 we were approached by Ms Sophie Wood who, having completed a newly refurbished apartment in Llandudno in February 2004. We are asked if we could estimate the price would likely be for a ninety year lease extension. Identical residencies in Llandudno with 100 year plus lease were worth £243,000. The average amount of ground rent was £65 invoiced annually. The lease finished in 2088. Considering the 63 years left we estimated the premium to the freeholder for the lease extension to be between £20,000 and £23,000 not including fees.