It’s an underpublicised truth that a Mousehole residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Mousehole property prices.Once your lease gets to 85ish years, you should start considering a lease extension. If the number of years remaining dips below 80 years, you will end up paying 50% of the property's 'marriage value' in addition to 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 leasehold owners in Mousehole will be able to extend under the legislation; however a conveyancer will be able to confirm whether you are eligibility. In some situations you may not qualify. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your conveyancer for the duration of the process.
It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to any lease with more than 35 years unexpired, the premises will be worth the same as a freehold for decades to come.
| 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
Using our service will provide you increased control over the value of your Mousehole leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to protracted correspondence with the landlord of her ground floor flat in Mousehole, Olivia started the lease extension process as the 80 year threshold was rapidly coming. The legal work was finalised in November 2006. The landlord’s charges were kept to an absolute minimum.
Last January we were approach by Mr Jude Fournier , who moved into a studio apartment in Mousehole in March 2010. We are asked if we could estimate the compensation to the landlord would be to extend the lease by an additional years. Similar flats in Mousehole with an extended lease were in the region of £208,200. The mid-range ground rent payable was £65 invoiced annually. The lease expired in 2086. Having 61 years remaining we calculated the premium to the freeholder for the lease extension to be within £20,000 and £23,000 exclusive of legals.
Mr and Mrs. G Carter took over the lease of a garden apartment in Mousehole in March 2001. We are asked if we could estimate the compensation to the landlord would be for a ninety year extension to my lease. Comparative flats in Mousehole with an extended lease were valued about £260,000. The mid-range amount of ground rent was £50 billed every twelve months. The lease elapsed on 24 October 2097. Taking into account 72 years as a residual term we approximated the premium to the freeholder to extend the lease to be between £9,500 and £11,000 plus costs.