The re-sale value of a leasehold property in Mevagissey depends on how long the lease has remaining. If it is close to or fewer than eighty years you should expect problems on re-sale, so it is recommended to arrange for a lease extension prior to purchasing. It is preferable to start the lease extension process when the lease still has 82 years unexpired so that a lease extension can be concluded prior to the 80 year threshold. Leasehold Reform legislation enables Mevagissey qualifying lessees to acquire a new lease which will be for the current unexpired lease term plus a further term of 90 years. The purpose of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold properties in Mevagissey with in excess of 100 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 property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 |
| 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. |
The conveyancing solicitors that we work with handle Mevagissey 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 conveyancing solicitor we work with provide it.
Dylan owned a high value apartment in Mevagissey on the market with a lease of just over fifty eight years left. Dylan on an informal basis spoke with his landlord a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent initially set at £150 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Dylan to exercise his statutory right. Dylan obtained expert advice and was able to make an informed decision and deal with the matter and readily saleable.
In 2011 we were approached by Mr and Mrs. K James who, having purchased a studio flat in Mevagissey in February 2012. The dilemma was if we could shed any light on how much (roughly) compensation to the landlord could be for a ninety year lease extension. Comparative residencies in Mevagissey with 100 year plus lease were in the region of £193,400. The mid-range ground rent payable was £65 billed yearly. The lease elapsed on 20 November 2085. Given that there were 59 years as a residual term we approximated the premium to the freeholder for the lease extension to be between £21,900 and £25,200 not including legals.
Last year we were phoned by Dr V Lee , who moved into a ground floor apartment in Mevagissey in May 2010. We are asked if we could estimate the premium would be to extend the lease by ninety years. Identical flats in Mevagissey with 100 year plus lease were in the region of £250,000. The average ground rent payable was £50 billed quarterly. The lease elapsed in 2096. Having 70 years remaining we estimated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 plus costs.