On the balance of probabilities where you own a flat in Southall you actually own a long leasehold interest over your property
It is conventional wisdom that a residential leasehold with more than one hundred years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to any lease with more than 35 years unexpired, the premises will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Coventry Building Society | 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. |
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with handle Southall 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 conveyancing solicitor we work with provide it.
Half a year ago Edward, started to get close to the eighty-year mark with the lease on his first floor apartment in Southall. In buying his flat 18 years previously, the unexpired term was of minimal significance. by good luck, he realised he needed to take action soon on a lease extension. Edward extended the lease just in the nick of time in April. Edward and the landlord subsequently agreed on an amount of £5,500 . If the lease had fallen below 80 years, the sum would have increased by a minimum £1,125.
Mr and Mrs. I Smith was assigned a lease of a one bedroom flat in Southall in September 2003. The question was if we could estimate the compensation to the landlord could be for a ninety year lease extension. Similar premises in Southall with 100 year plus lease were in the region of £250,400. The mid-range amount of ground rent was £65 billed per annum. The lease ran out in 2089. Given that there were 64 years as a residual term we estimated the premium to the landlord to extend the lease to be within £19,000 and £22,000 exclusive of expenses.
An example of a Lease Extension decision for a Southall property is 33 Barbican Road in January 2013. The Tribunals calculation of the lease extension premium payable was £17,592. This case was in relation to 1 flat. The unexpired lease term was 55.12 years.