Owning a apartment usually means owning a lease of the property, which has a set term of years. your lease will usually be granted for a prescribed period of time , usually 99 or 125 years, although we have seen longer and shorter terms in Penzance. Clearly, the term of lease left shortens as time goes by. This is often overlooked and only becomes a problem when the flat or house has to be sold or re-mortgaged. The shorter the lease the less it is worth and the more it will cost to procure a lease extension. Eligible leaseholders in Penzance have the right to extend the lease for an additional 90 years under Leasehold Reform legislation. Please give due deliberation before delaying your Penzance lease extension. Holding off that expense now likely increases the price you will ultimately incur for a lease extension
It is conventional wisdom that a residential leasehold with more than one hundred years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 35 years remaining, the property will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
|
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a landlord in Penzance,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Penzance valuers.
Lewis owned a conversion apartment in Penzance on the market with a lease of a few days over fifty eight years remaining. Lewis on an informal basis contacted his landlord a well known local-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £50 yearly. Ordinarily, ground rent would not be payable on a lease extension were Lewis to exercise his statutory right. Lewis procured expert advice and was able to make an informed judgement and deal with the matter and ending up with a market value flat.
Last February we were called by Dr P Flores , who acquired a purpose-built flat in Penzance in July 2009. The question was if we could shed any light on how much (approximately) price would be for a ninety year lease extension. Comparative residencies in Penzance with 100 year plus lease were valued about £285,000. The average amount of ground rent was £55 invoiced every twelve months. The lease elapsed in 2105. Having 79 years outstanding we estimated the compensation to the landlord to extend the lease to be within £13,300 and £15,400 plus expenses.
Mrs Katherine Petit purchased a garden flat in Penzance in September 2010. The question was if we could shed any light on how much (roughly) premium would likely be for a 90 year lease extension. Comparable flats in Penzance with 100 year plus lease were worth £193,400. The average amount of ground rent was £65 billed annually. The lease finished in 2085. Having 59 years remaining we estimated the premium to the landlord for the lease extension to be within £21,900 and £25,200 exclusive of costs.