St Austell residential property held on a long lease is a wasting asset because a leaseholder merely owns the property for a period of years.
It is generally accepted that a property with more than one hundred 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 equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in St Austell can be a difficult process. We recommend you procure professional help from a lawyer and valuer with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring St Austell lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Logan was the the leasehold owner of a 2 bedroom apartment in St Austell on the market with a lease of a few days over 72 years unexpired. Logan informally contacted his landlord a well known local-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 on the basis of a rise in the rent to £200 annually. Ordinarily, ground rent would not be payable on a lease extension were Logan to exercise his statutory right. Logan procured expert advice and was able to make an informed judgement and handle with the matter and sell the property.
Ms R Carter took over the lease of a garden flat in St Austell in January 1995. We are asked if we could approximate the premium would likely be for a ninety year lease extension. Comparative properties in St Austell with 100 year plus lease were valued around £285,000. The average amount of ground rent was £55 collected every twelve months. The lease end date was in 2106. Given that there were 80 years as a residual term we estimated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 plus costs.
In 2011 we were approached by Mr and Mrs. K Wilson who, having completed a ground floor flat in St Austell in January 2011. We are asked if we could approximate the price would be to prolong the lease by ninety years. Comparative premises in St Austell with 100 year plus lease were valued about £200,800. The average amount of ground rent was £65 invoiced yearly. The lease finished in 2086. Given that there were 60 years as a residual term we calculated the premium to the landlord to extend the lease to be between £20,900 and £24,200 not including professional charges.