Southall leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. It is the case that most Southall tenants have the right to extend their lease by an additional 90 years in accordance with the 1993 Leasehold Reform Act. If you are a leasehold owner in Southall you really ought to investigate if your lease has between seventy and ninety years left. There are good reasons why a Southall leaseholder with a lease having around 80 years remaining should take action to make sure that a lease extension is actioned without delay
Leasehold residencies in Southall with in excess of 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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 be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| 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 lawyer we work with provide it.
Trailing unsuccessful discussions with the freeholder of her purpose-built flat in Southall, Rebecca started the lease extension process just as her lease was approaching the all-important eighty-year mark. The transaction was concluded in July 2007. The landlord’s charges were restricted to approximately 700 pounds.
Last Christmas we were called by Mr and Mrs. O Phillips , who took over the lease of a first floor flat in Southall in July 2002. We are asked if we could shed any light on how much (approximately) price would be for a 90 year lease extension. Identical properties in Southall with a long lease were in the region of £200,000. The mid-range amount of ground rent was £50 invoiced monthly. The lease finished on 13 October 2103. Given that there were 77 years left we calculated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 not including expenses.
An example of a Lease Extension decision for a Southall residence is 33 Barbican Road in January 2013. The Tribunals calculation of the lease extension premium payable was £17,592. This case related to 1 flat. The unexpired residue of the current lease was 55.12 years.