The value of Ruthin leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can escalate materialy once the remaining term is less than eighty years
It is conventional wisdom that a property with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 30 years unexpired, the property will be equivalent in value to 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. |
| Halifax | Minimum 70 years from the date 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. |
| 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 Ruthin 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 lawyer we work with provide it.
In recent months Jayden, came critically close to the 80-year threshold with the lease on his garden apartment in Ruthin. In buying his property 19 years ago, the length of the lease was of minimal interest. Luckily, he recognised he needed to take action soon on a lease extension. Jayden extended the lease just ahead of time in August. Jayden and the freeholder ultimately agreed on sum of £6,000 . If he not met the deadline, the premium would have increased by a minimum £1,050.
Last year we were e-mailed by Mr and Mrs. N Ricardo , who completed a one bedroom flat in Ruthin in August 1997. The dilemma was if we could shed any light on how much (approximately) premium could be for a 90 year lease extension. Comparative flats in Ruthin with a long lease were in the region of £200,000. The average ground rent payable was £50 invoiced per annum. The lease elapsed in 2102. Considering the 77 years outstanding we estimated the premium to the landlord to extend the lease to be within £8,600 and £9,800 exclusive of legals.
In 2013 we were called by Mr and Mrs. R Walker who, having was assigned a lease of a first floor apartment in Ruthin in June 2000. We are asked if we could approximate the price would be for a 90 year extension to my lease. Identical residencies in Ruthin with a long lease were worth £260,200. The average ground rent payable was £65 collected annually. The lease terminated on 1 January 2091. Considering the 66 years as a residual term we approximated the compensation to the landlord for the lease extension to be between £16,200 and £18,600 plus fees.