When it comes to residential leasehold premises in Padstow, you are actually purchasing a right to live in a property for a prescribed time frame. These days flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you should think about extending the lease sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease gets disproportionately more expensive particularly when there are fewer than 80 years left. Anyone in Padstow with a lease drawing near to 81 years unexpired should seriously think of extending it as soon as possible. When a lease has less than eighty years remaining, under the current legislation the freeholder is entitled to calculate and demand a larger amount, assessed on a technical computation, known as “marriage value” which is due.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 35 years unexpired, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service gives you better control over the value of your Padstow leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of lengthy negotiations with the landlord of her studio flat in Padstow, Francesca commenced the lease extension process as the 80 year deadline was fast nearing. The lease extension completed in March 2011. The landlord’s charges were negotiated to slightly above 600 pounds.
Ms N André acquired a first floor apartment in Padstow in June 2005. We are asked if we could shed any light on how much (roughly) premium would likely be for a ninety year lease extension. Comparable residencies in Padstow with a long lease were in the region of £250,400. The mid-range amount of ground rent was £65 collected quarterly. The lease elapsed in 2088. Taking into account 64 years unexpired we estimated the premium to the landlord for the lease extension to be between £19,000 and £22,000 plus expenses.
Last Christmas we were contacted by Dr Jonathan Stewart , who acquired a one bedroom apartment in Padstow in August 2001. The question was if we could approximate the premium could be for a 90 year extension to my lease. Comparable flats in Padstow with 100 year plus lease were in the region of £189,000. The average ground rent payable was £55 billed quarterly. The lease expired in 2077. Considering the 53 years remaining we estimated the compensation to the freeholder for the lease extension to be between £28,500 and £33,000 plus costs.