When it comes to long leasehold property in Plumstead, you are in fact renting it for a certain amount of time. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you may think about a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease increases markedly especially when there are less than 80 years left. Anyone in Plumstead with a lease drawing near to 81 years remaining should seriously consider extending it without delay. Once a lease has below eighty years outstanding, under the relevant Act the freeholder can calculate and levy a greater amount, based on a technical multiplication, known as “marriage value” which is due.
Leasehold residencies in Plumstead with over one hundred years left 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 to be gained by purchasing the freehold unless savings on ground rent and service charges warrant it.
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service will provide you better control over the value of your Plumstead leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Nathaniel was the the leasehold proprietor of a conversion apartment in Plumstead on the market with a lease of a little over fifty eight years remaining. Nathaniel informally contacted his landlord being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to grant 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. No ground rent would be payable on a lease extension were Nathaniel to invoke his statutory right. Nathaniel obtained expert advice and secured an acceptable deal informally and sell the property.
Last Autumn we were phoned by Mr and Mrs. K Lewis , who was assigned a lease of a basement flat in Plumstead in October 1995. 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. Comparable residencies in Plumstead with 100 year plus lease were worth £275,000. The mid-range ground rent payable was £55 invoiced monthly. The lease expired in 2101. Considering the 76 years left we calculated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 plus professional charges.
An example of a Lease Extension case for a Plumstead residence 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.