Pencader residential property held on a long lease is a wasting asset as the leaseholder only owns the property for a set term.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
Lease extensions in Pencader can be a difficult process. We recommend you obtain guidance from a conveyancing solicitor and valuer well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Pencader lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Following unsuccessful discussions with the freeholder of her first floor flat in Pencader, Chantelle commenced the lease extension process as the eighty year deadline was swiftly approaching. The transaction was concluded in January 2005. The freeholder’s charges were restricted to under four hundred pounds.
In 2011 we were e-mailed by Mr and Mrs. T Bertrand who, having bought a purpose-built apartment in Pencader in March 2004. We are asked if we could estimate the premium would likely be to extend the lease by 90 years. Comparative homes in Pencader with 100 year plus lease were in the region of £270,000. The average ground rent payable was £55 billed yearly. The lease ended in 2101. Having 75 years left we estimated the premium to the landlord for the lease extension to be within £9,500 and £11,000 plus professional charges.
In 2014 we were approached by Mr and Mrs. L Jackson who, having moved into a first floor apartment in Pencader in November 2005. We are asked if we could approximate the premium would be for a ninety year extension to my lease. Similar flats in Pencader with a long lease were worth £173,800. The average amount of ground rent was £60 collected monthly. The lease elapsed in 2081. Considering the 55 years unexpired we calculated the compensation to the freeholder to extend the lease to be between £31,400 and £36,200 exclusive of fees.