Paddington leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Paddington residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Paddington you must see if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under eighty years, the compensation to the landlord for any lease extension sharply increases as part of the premium you pay is what is known as a marriage value
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 30 years left, the residence will be worth the same as a freehold for decades to come.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Paddington can be a difficult process. We recommend you get guidance from a conveyancer and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Paddington lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Following lengthy negotiations with the freeholder of her leasehold apartment in Paddington, Olivia commenced the lease extension process just as her lease was nearing the all-important eighty-year deadline. The lease extension completed in July 2010. The landlord’s charges were kept to an absolute minimum.
Last year we were phoned by Mrs Rachael Howard , who moved into a one bedroom flat in Paddington in November 2007. The dilemma was if we could approximate the premium would be for a 90 year extension to my lease. Comparative flats in Paddington with an extended lease were worth £254,200. The average amount of ground rent was £60 invoiced annually. The lease lapsed in 2075. Taking into account 51 years unexpired we approximated the premium to the landlord for the lease extension to be within £43,700 and £50,600 exclusive of legals.
An example of a Lease Extension case for a Paddington flat is Flats 37 & 39 88/90 Portland Place in December 2010. The Tribunal determined that the premium payable for the lease extensions in respect of these two flats is as follows:- For Flat 37, the sum of £385,230.00 For Flat 39, the sum of £436,780.00 This case related to 2 flats. The remaining number of years on the lease was 24.02 years.