When it comes to long leasehold premises in Lansbury, you effectively rent it for a certain period of time. These days flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you may think about a lease extension sooner rather than later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly especially when there are less than 80 years remaining. Leasehold owners in Lansbury with a lease nearing 81 years remaining should seriously consider extending it sooner rather than later. Once a lease has below eighty years left, under the current legislation the freeholder is entitled to calculate and demand a greater premium, based on a technical computation, strangely termed as “marriage value” which is due.
Leasehold premises in Lansbury with more than one hundred years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and service 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 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with undertake Lansbury 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 lawyer we work with provide it.
Harrison owned a studio flat in Lansbury being marketed with a lease of a little over sixty years unexpired. Harrison on an informal basis approached his landlord a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a new rent to start with set at £100 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Harrison to exercise his statutory right. Harrison obtained expert advice and was able to make an informed decision and handle with the matter and sell the flat.
Last month we were approach by Ms Lucy Dupont , who moved into a newly refurbished apartment in Lansbury in June 2002. The question was if we could shed any light on how much (roughly) premium would be to extend the lease by a further 90 years. Comparative premises in Lansbury with 100 year plus lease were valued around £171,800. The average ground rent payable was £55 invoiced yearly. The lease concluded in 2076. Having 50 years as a residual term we calculated the premium to the landlord to extend the lease to be within £32,300 and £37,400 plus costs.
An example of a Vesting Order and Purchase of freehold decision for a Lansbury residence is Ground Floor Flat 4A Baronet Road in February 2010. Following a vesting order by Edmonton County Court on 23rd December 2008 (case number 8ED064) the Tribunal decided that the price that the Applicant for the freehold interest should pay is £8,689.00 This case affected 2 flats. The unexpired term was 80.01 years.