It’s a harsh certainty that a Fowey residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Fowey property market.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. If the number of years remaining slips below 80 years, you will end up paying 50% 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 Fowey will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you are eligibility. In some cases you may not qualify. There are also strict timeframes and procedures to follow once the process is instigated and you will need to be guided by your conveyancer from beginning to end of the process.
It is conventional wisdom that a residential leasehold with more than 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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. |
| Godiva Mortgages | 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with handle Fowey 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.
Eli was the the leasehold owner of a conversion flat in Fowey on the market with a lease of a few days over 72 years unexpired. Eli on an informal basis approached his landlord being a well known local-based freehold company for a lease extension. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £100 annually. Ordinarily, ground rent would not be payable on a lease extension were Eli to invoke his statutory right. Eli procured expert legal guidance and secured satisfactory resolution without going to tribunal and sell the property.
Mr and Mrs. A Sharif acquired a first floor apartment in Fowey in August 2012. The question was if we could estimate the premium could be to extend the lease by ninety years. Identical flats in Fowey with an extended lease were worth £246,800. The mid-range amount of ground rent was £60 billed quarterly. The lease expired on 28 January 2075. Taking into account 50 years outstanding we approximated the premium to the landlord for the lease extension to be within £44,700 and £51,600 exclusive of costs.
In 2012 we were e-mailed by Mr C Hall who, having took over the lease of a studio flat in Fowey in September 2011. We are asked if we could approximate the premium could be for a 90 year lease extension. Identical flats in Fowey with a long lease were valued about £208,200. The mid-range ground rent payable was £65 billed every twelve months. The lease lapsed in 2086. Taking into account 61 years left we estimated the premium to the landlord for the lease extension to be between £20,000 and £23,000 not including fees.