It’s a harsh truth that a Falmouth residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Falmouth property prices.Once your lease gets to 85ish years, you should start thinking about 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 falls below eighty years - otherwise a higher premium will be due. The majority of leasehold owners in Falmouth will be able to extend under the legislation; however a lawyer will be able to clarify whether you qualify for an extension. In some situations you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the process.
It is conventional wisdom that a property with more than 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 35 years remaining, the property 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a landlord in Falmouth,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Falmouth valuers.
Following unsuccessful negotiations with the landlord of her two bedroom apartment in Falmouth, Alisha started the lease extension process as the 80 year threshold was rapidly nearing. The transaction was finalised in February 2013. The landlord’s fees were kept to an absolute minimum.
In 2012 we were approached by Mrs Sophia Rodríguez who, having purchased a purpose-built flat in Falmouth in May 1999. We are asked if we could approximate the compensation to the landlord could be for a ninety year extension to my lease. Identical premises in Falmouth with 100 year plus lease were valued around £290,000. The average ground rent payable was £60 billed monthly. The lease came to a finish in 2106. Considering the 80 years as a residual term we estimated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 not including expenses.
Mr D Bell was assigned a lease of a one bedroom apartment in Falmouth in February 2003. The question was if we could approximate the price would likely be for a ninety year extension to my lease. Identical properties in Falmouth with 100 year plus lease were valued about £200,800. The average ground rent payable was £65 collected monthly. The lease finished in 2086. Given that there were 60 years unexpired we approximated the compensation to the landlord to extend the lease to be within £20,900 and £24,200 exclusive of expenses.