The value of Falmouth 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 substantially once the remaining term is less than eighty years
It is conventional wisdom that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 35 years left, the residence will be equivalent in value to a freehold for many years ahead.
| 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; |
| Birmingham Midshires | 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you increased control over the value of your Falmouth leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Alexander was the the leasehold proprietor of a conversion apartment in Falmouth on the market with a lease of just over 72 years remaining. Alexander informally approached his landlord a well known local-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 new rent at the outset set at £100 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Alexander to exercise his statutory right. Alexander procured expert legal guidance and secured an acceptable resolution informally and ending up with a market value flat.
Last Christmas we were e-mailed by Dr I Peterson , who moved into a garden apartment in Falmouth in May 2009. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be for a ninety year extension to my lease. Comparative residencies in Falmouth with an extended lease were worth £166,400. The average ground rent payable was £60 billed yearly. The lease lapsed in 2079. Considering the 54 years as a residual term we approximated the compensation to the freeholder to extend the lease to be within £32,300 and £37,400 exclusive of legals.
Mr and Mrs. M Carter purchased a garden apartment in Falmouth in January 2012. The question was if we could shed any light on how much (roughly) premium would be to prolong the lease by a further 90 years. Comparative premises in Falmouth with 100 year plus lease were in the region of £227,800. The mid-range amount of ground rent was £45 invoiced quarterly. The lease lapsed on 23 July 2090. Considering the 65 years remaining we estimated the premium to the freeholder to extend the lease to be within £13,300 and £15,400 plus professional charges.