Unfortunately that a Penzance residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Penzance property market.Once your lease gets to 85ish years, you need to start considering a lease extension. If lease term falls below 80 years, you will then be required to pay half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property The majority of flat owners in Penzance will be able to extend under the legislation; however a lawyer should be able to clarify if you qualify for an extension. In some situations you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer from beginning to end of the formalities.
Leasehold premises in Penzance with in excess of 100 years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with procure Penzance 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 lawyer we work with provide it.
In the wake of 6 months of lengthy discussions with the landlord of her one bedroom flat in Penzance, Naomi initiated the lease extension process as the eighty year deadline was swiftly advancing. The legal work was finalised in January 2005. The freeholder’s charges were kept to an absolute minimum.
Last Christmas we were approach by Dr N Young , who moved into a first floor apartment in Penzance in August 2010. The question was if we could shed any light on how much (approximately) compensation to the landlord could be to prolong the lease by ninety years. Comparable properties in Penzance with a long lease were valued around £265,000. The average amount of ground rent was £50 billed every twelve months. The lease concluded on 28 September 2099. Taking into account 73 years as a residual term we approximated the premium to the landlord to extend the lease to be between £9,500 and £11,000 exclusive of expenses.
Mr F Turner took over the lease of a recently refurbished apartment in Penzance in July 1995. We are asked if we could shed any light on how much (roughly) premium would likely be to extend the lease by a further 90 years. Comparative residencies in Penzance with 100 year plus lease were worth £264,000. The mid-range amount of ground rent was £60 invoiced monthly. The lease came to a finish on 5 October 2079. Taking into account 53 years left we estimated the compensation to the landlord to extend the lease to be between £37,100 and £42,800 not including professional charges.