Unfortunately that a Pencoed residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Pencoed property prices.Where your lease has approximately ninety years left, you should start thinking about a lease extension. If lease term dips under 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 extra value that a lease extension will add the property Most leasehold owners in Pencoed will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm whether you qualify for an extension. In some situations you may not qualify. There are also strict timeframes and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancer for the duration of the process.
Leasehold properties in Pencoed with more than 100 years remaining on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Pencoed can be a difficult process. We recommend you get professional help from a conveyancer 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 in-depth market knowledge dealing with Pencoed lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Liam owned a conversion apartment in Pencoed on the market with a lease of fraction over 61 years remaining. Liam on an informal basis contacted his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years on the basis of a rise in the rent to £125 yearly. Ordinarily, ground rent would not be due on a lease extension were Liam to invoke his statutory right. Liam procured expert legal guidance and was able to make a more informed decision and handle with the matter and readily saleable.
Last Spring we were phoned by Dr L Martinez , who completed a first floor apartment in Pencoed in March 1998. We are asked if we could estimate the compensation to the landlord could be to prolong the lease by a further 90 years. Comparable homes in Pencoed with 100 year plus lease were worth £166,400. The mid-range amount of ground rent was £60 billed quarterly. The lease elapsed in 2079. Considering the 54 years remaining we calculated the compensation to the landlord to extend the lease to be within £32,300 and £37,400 plus legals.
Last Autumn we were contacted by Mrs T Parker , who took over the lease of a basement apartment in Pencoed in February 2003. The question was if we could shed any light on how much (approximately) premium would be to extend the lease by ninety years. Similar premises in Pencoed with 100 year plus lease were in the region of £227,800. The mid-range ground rent payable was £45 collected monthly. The lease concluded on 10 July 2090. Having 65 years unexpired we estimated the premium to the landlord for the lease extension to be between £13,300 and £15,400 not including expenses.