With a domestic leasehold property in Fowey, you are actually buying a right to live in a property for a prescribed time frame. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you may consider extending the lease sooner rather than later. Accepted thinking is that the shorter the number of years is the cost of extending the lease becomes disproportionately more expensive notably when there are fewer than 80 years left. Anyone in Fowey with a lease approaching 81 years remaining should seriously consider extending it as soon as possible. Once a lease has fewer than 80 years left, under the current legislation the freeholder can calculate and demand a larger premium, based on a technical calculation, known as “marriage value” which is payable.
Leasehold residencies in Fowey with more than one hundred years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Yorkshire 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. |
Using our service will provide you enhanced control over the value of your Fowey leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Nathaniel was the the leasehold owner of a high value flat in Fowey on the market with a lease of a few days over 61 years left. Nathaniel on an informal basis approached his landlord being a well known Bristol-based freehold company for a lease extension. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £100 per annum and increase every 25 years thereafter. No ground rent would be payable on a lease extension were Nathaniel to exercise his statutory right. Nathaniel procured expert legal guidance and was able to make a more informed decision and handle with the matter and readily saleable.
Last Autumn we were contacted by Mrs A Simon , who purchased a purpose-built apartment in Fowey in November 2009. We are asked if we could shed any light on how much (roughly) premium could be for a ninety year lease extension. Comparable properties in Fowey with a long lease were worth £225,400. The mid-range ground rent payable was £45 invoiced annually. The lease finished in 2089. Having 64 years unexpired we estimated the premium to the landlord to extend the lease to be between £16,200 and £18,600 plus expenses.
Mr and Mrs. A Cook acquired a one bedroom flat in Fowey in April 2001. We are asked if we could approximate the premium could be to prolong the lease by 90 years. Comparative flats in Fowey with 100 year plus lease were in the region of £270,000. The average amount of ground rent was £55 invoiced per annum. The lease expired in 2100. Taking into account 75 years left we calculated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 exclusive of legals.