When it comes to domestic leasehold property in Newquay, you are in fact renting it for a certain period of time. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you should think about extending the lease sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly particularly once there are fewer than eighty years left. Leasehold owners in Newquay with a lease drawing near to 81 years remaining should seriously consider extending it without delay. Once a lease has less than eighty years outstanding, under the relevant legislation the freeholder is entitled to calculate and demand a greater premium, based on a technical multiplication, known as “marriage value” which is due.
Leasehold properties in Newquay with in excess of one hundred years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Chelsea 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. |
| 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Regardless of whether you are a tenant or a landlord in Newquay,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Newquay valuers.
After lengthy negotiations with the freeholder of her studio flat in Newquay, Katherine initiated the lease extension process just as the lease was coming close to the critical 80-year mark. The transaction was finalised in February 2014. The landlord’s fees were negotiated to below 450 GBP.
In 2014 we were called by Dr Tia Watson who, having bought a studio flat in Newquay in November 1995. The question was if we could shed any light on how much (approximately) compensation to the landlord would be to prolong the lease by ninety years. Comparative residencies in Newquay with 100 year plus lease were in the region of £252,800. The average ground rent payable was £65 collected quarterly. The lease concluded in 2090. Having 65 years unexpired we approximated the premium to the landlord for the lease extension to be within £17,100 and £19,800 not including expenses.
In 2014 we were called by Ms H Norbert who, having took over the lease of a ground floor apartment in Newquay in February 1995. We are asked if we could estimate the price could be to extend the lease by 90 years. Comparable properties in Newquay with an extended lease were worth £191,400. The average amount of ground rent was £55 collected annually. The lease ran out in 2079. Considering the 54 years left we estimated the compensation to the freeholder for the lease extension to be within £34,200 and £39,600 plus professional charges.