It’s a harsh truth that a Pentyrch residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Pentyrch property market.Once your lease gets to 85ish years, you need to start thinking about a lease extension. If lease term slips below 80 years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property The majority of leasehold owners in Pentyrch will be able to extend under the legislation; however a conveyancer should be able to clarify whether you are eligibility. In some situations you may not qualify. There are also strict timetables and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with undertake Pentyrch 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.
In the wake of 9 months of lengthy correspondence with the freeholder of her studio apartment in Pentyrch, Stephanie commenced the lease extension process as the eighty year mark was quickly advancing. The transaction was concluded in September 2011. The freeholder’s costs were kept to an absolute minimum.
In 2013 we were phoned by Ms V Jones who, having was assigned a lease of a garden flat in Pentyrch in April 2002. The question was if we could approximate the price could be to extend the lease by 90 years. Similar flats in Pentyrch with an extended lease were valued around £200,800. The average amount of ground rent was £65 collected every twelve months. The lease came to a finish on 24 June 2086. Taking into account 60 years remaining we approximated the compensation to the landlord to extend the lease to be between £20,900 and £24,200 plus professional charges.
Dr P Rivera took over the lease of a garden flat in Pentyrch in March 2005. The question was if we could estimate the compensation to the landlord would likely be for a ninety year extension to my lease. Identical residencies in Pentyrch with an extended lease were valued about £255,000. The average ground rent payable was £50 collected yearly. The lease expiry date was in 2097. Considering the 71 years unexpired we calculated the premium to the landlord for the lease extension to be between £9,500 and £11,000 exclusive of expenses.