The re-sale value of a leasehold property in Porthleven depends on how long the lease has remaining. If it is near to or less than 80 years you should anticipate problems on re-sale, so it is advisable to arrange for a lease extension prior to buying. It is ideal to start the lease extension process when the lease still has 82 years unexpired so that formalities can be finalised well before the 80 year cut off point. Statute entitles Porthleven qualifying lessees to obtain a lease extension of ninety 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 premium payable by the lessee to the freeholder for the purchase of the lease extension.
It is generally considered that a residential leasehold with over one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Yorkshire 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. |
Retaining our service gives you enhanced control over the value of your Porthleven leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
George was the the leasehold proprietor of a conversion apartment in Porthleven on the market with a lease of a little over fifty eight years outstanding. George on an informal basis approached his freeholder a well known Bristol-based freehold company for a lease extension. The freeholder was keen to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £200 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were George to exercise his statutory right. George obtained expert advice and secured satisfactory deal without resorting to tribunal and sell the flat.
Mrs F Bailey was assigned a lease of a first floor apartment in Porthleven in April 1997. We are asked if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Comparative properties in Porthleven with an extended lease were worth £200,800. The mid-range ground rent payable was £65 invoiced yearly. The lease elapsed on 7 March 2086. Given that there were 60 years left we estimated the premium to the landlord to extend the lease to be between £20,900 and £24,200 plus legals.
Last Winter we were approach by Dr Danielle Torres , who took over the lease of a studio apartment in Porthleven in August 2005. We are asked if we could shed any light on how much (approximately) compensation to the landlord could be for a 90 year extension to my lease. Identical properties in Porthleven with an extended lease were in the region of £255,000. The average ground rent payable was £50 billed every twelve months. The lease concluded in 2097. Considering the 71 years left we approximated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 plus legals.