Unfortunately that a Padstow residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the first few years due to the depreciation being disguised by increases in the Padstow property prices.Where your lease has approximately ninety years left, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips below 80 years - otherwise a higher premium will be due. The majority of flat owners in Padstow will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify whether you are eligibility. In some cases you may not qualify. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the process.
It is generally accepted that a property with in excess of 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 30 years left, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Godiva Mortgages | 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with undertake Padstow 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.
In 2014 Blake, came perilously close to the eighty-year threshold with the lease on his one bedroom apartment in Padstow. In buying his property two decades ago, the length of the lease was of minimal concern. As luck would have it, he noticed he would imminently be paying an escalated premium for a lease extension. Blake was able to extend his lease just under the wire in May. Blake and the landlord in the end agreed on an amount of £5,500 . If the lease had slid below eighty years, the figure would have increased by a minimum £1,000.
In 2010 we were approached by Dr Hannah Morel who, having took over the lease of a basement flat in Padstow in April 2011. We are asked if we could estimate the compensation to the landlord would be for a ninety year lease extension. Identical flats in Padstow with an extended lease were worth £216,000. The mid-range ground rent payable was £60 invoiced monthly. The lease came to a finish on 23 August 2082. Having 58 years outstanding we calculated the compensation to the landlord for the lease extension to be within £28,500 and £33,000 not including expenses.
In 2012 we were approached by Mr and Mrs. T Brooks who, having moved into a ground floor apartment in Padstow in June 2000. The question was if we could estimate the compensation to the landlord could be to extend the lease by ninety years. Similar flats in Padstow with an extended lease were in the region of £200,000. The mid-range ground rent payable was £50 billed yearly. The lease elapsed on 27 March 2102. Given that there were 78 years outstanding we approximated the premium to the landlord for the lease extension to be within £8,600 and £9,800 not including professional charges.