It’s a harsh certainty that a Looe residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the reduction being disguised by increases in the Looe property prices.Once your lease gets to 85ish years, you need to start considering a lease extension. If lease term drops under 80 years, you will then be required to pay 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 Looe will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you are eligibility. In some situations you may not qualify. There are also strict deadlines and procedures to follow once the process is instigated and you will need to be guided by your conveyancing solicitor throughout the process.
It is conventional wisdom that a property with more than one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 35 years unexpired, the residence will be worth the same as 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; |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Looe 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 Looe lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last Spring Mason, started to get close to the eighty-year threshold with the lease on his basement apartment in Looe. Having bought his flat twenty years previously, the lease term was of little relevance. Luckily, he recognised he would soon be paying an escalated premium for Extending the lease. Mason extended the lease at the eleventh hour in April. Mason and the freeholder in the end agreed on the final figure of £5,000 . If he not met the deadline, the figure would have increased by at least £1,150.
Last Winter we were contacted by Mr Sebastian Walker , who completed a first floor flat in Looe in May 1995. The question was if we could shed any light on how much (roughly) compensation to the landlord would likely be to extend the lease by 90 years. Identical residencies in Looe with 100 year plus lease were worth £300,000. The average ground rent payable was £50 billed yearly. The lease ended in 2102. Considering the 76 years left we calculated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 not including legals.
Dr Aiden Gómez completed a basement apartment in Looe in July 2010. We are asked if we could shed any light on how much (approximately) premium would likely be for a ninety year extension to my lease. Comparable residencies in Looe with 100 year plus lease were worth £257,800. The mid-range ground rent payable was £65 invoiced annually. The lease finished in 2091. Having 65 years remaining we estimated the compensation to the freeholder to extend the lease to be between £18,100 and £20,800 exclusive of fees.