The market value of a leasehold property in Perranporth is impacted by how many years the lease has remaining. If it is close to or fewer than eighty years you should foresee problems on re-sale, so it is advisable to arrange for the lease to be extended ahead of purchasing. It is preferable to start the lease extension process when a lease still has 82 years to run so that all matters can be addressed ahead of the 80 year mark. Leasehold Reform legislation enables Perranporth qualifying lessees to acquire a lease extension of 90 years in addition to the remaining length of the lease at a peppercorn rent (that is, rent free). The intention of the valuation is to determine the sum payable by the lessee to the freeholder for the acquisition of the lease extension.
It is generally considered that a property with in excess of 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 45 years unexpired, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with undertake Perranporth 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 recent months Luca, started to get near to the 80-year threshold with the lease on his ground floor apartment in Perranporth. Having purchased his flat two decades ago, the unexpired term was of little interest. Luckily, he became aware that he would imminently be paying an escalated premium for a lease extension. Luca was able to extend his lease at the eleventh hour in August. Luca and the landlord who owned the flat above ultimately settled on sum of £5,500 . If he not met the deadline, the premium would have gone up by a minimum £975.
Last Winter we were contacted by Dr Blake Mason , who bought a first floor apartment in Perranporth in May 2005. The question was if we could approximate the premium would likely be for a 90 year extension to my lease. Similar residencies in Perranporth with an extended lease were in the region of £264,000. The mid-range ground rent payable was £60 billed monthly. The lease finished on 16 October 2078. Having 53 years remaining we estimated the compensation to the landlord to extend the lease to be within £37,100 and £42,800 plus professional charges.
Last August we were e-mailed by Mr Michael Morgan , who owned a one bedroom flat in Perranporth in April 2000. The dilemma was if we could approximate the premium could be for a ninety year extension to my lease. Comparable flats in Perranporth with an extended lease were in the region of £225,400. The mid-range amount of ground rent was £45 billed per annum. The lease expired on 21 May 2089. Given that there were 64 years outstanding we calculated the premium to the freeholder to extend the lease to be between £16,200 and £18,600 not including costs.