With a residential leasehold property in West London, you effectively rent it for a certain period of time. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you should consider extending the lease sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly notably once there are less than 80 years remaining. Leasehold owners in West London with a lease nearing 81 years remaining should seriously consider extending it sooner than later. When the lease term has below eighty years left, under the current legislation the landlord can calculate and demand a greater premium, assessed on a technical multiplication, strangely termed as “marriage value” which is due.
Leasehold properties in West London with over 100 years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges justify 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. |
| Chelsea Building Society | 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with undertake West London 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.
Following protracted discussions with the landlord of her one bedroom apartment in West London, Jade initiated the lease extension process as the eighty year threshold was quickly coming. The transaction was concluded in February 2011. The landlord’s costs were kept to an absolute minimum.
In 2014 we were called by Dr C Adams who, having took over the lease of a basement flat in West London in October 1995. The dilemma was if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Comparative flats in West London with an extended lease were valued around £246,800. The mid-range ground rent payable was £60 collected every twelve months. The lease came to a finish on 24 January 2074. Considering the 50 years unexpired we calculated the compensation to the freeholder for the lease extension to be within £44,700 and £51,600 exclusive of costs.
An example of a Lease Extension decision for a West London flat is 137 & 139 Haberdasher Street in December 2013. The Tribunal determines in accordance with section 48 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 that the premium for the extended lease for each Property should be £12,350.00. This case related to 2 flats. The unexpired lease term was 72.39 years.