Blackfen leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease gets more expensive. Most owners of residential leasehold property in Blackfen enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Blackfen you really ought to investigate if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under eighty years, the cost of any lease extension sharply increases as part of the premium you pay is what is known as a marriage value
Leasehold properties in Blackfen with over 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges merit it.
| 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 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. |
| 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. |
The lawyers that we work with undertake Blackfen 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 conveyancer we work with provide it.
Half a year ago Edward, started to get close to the 80-year mark with the lease on his two bedroom flat in Blackfen. In buying his property 19 years ago, the length of the lease was of minimal significance. Fortunately, he became aware that he would soon be paying way over the odds for a lease extension. Edward was able to extend his lease just under the wire in April. Edward and the freeholder via the management company subsequently settled on the final figure of £6,000 . If the lease had fallen to less than 80 years, the amount would have become more exhorbitant by at least £950.
Dr Eleanor Gómez acquired a basement flat in Blackfen in July 2001. The dilemma was if we could shed any light on how much (roughly) premium would likely be for a ninety year extension to my lease. Comparative residencies in Blackfen with 100 year plus lease were valued around £290,000. The average ground rent payable was £60 billed annually. The lease came to a finish in 2105. Taking into account 80 years unexpired we approximated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 not including fees.
An example of a Lease Extension case for a Blackfen flat is 103a Footscray Road in January 2014. The tribunal determines that the premium payable for the extended lease should be £34,500 according to the expert witness valuation calculation This case related to 1 flat.