There is no doubt about it a leasehold flat or house in Belvedere is a wasting asset as a result of the shortening lease. If the residual term has, in excess of one hundred years to run then this decrease may be negligible that being said there will become a point in time when a lease has less than eighty years left as part of the premium you will incur is what is known as a marriage value. This could increase markedly the cost. It is the main logic behind why you should consider extending sooner as opposed to later. Many flat owners in Belvedere will qualify for this right; however a conveyancer will be able to advise whether you are eligible to extend your lease. In limited situations you may not qualify, the most frequent reason being that you have not been the owner of the property for two years.
Leasehold premises in Belvedere with over one hundred years left 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 purchasing the freehold unless savings on ground rent and estate charges justify 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with undertake Belvedere 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.
Evan owned a high value flat in Belvedere being sold with a lease of a little over 59 years unexpired. Evan informally approached his landlord a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £200 yearly. Ordinarily, ground rent would not be due on a lease extension were Evan to exercise his statutory right. Evan obtained expert legal guidance and was able to make a more informed judgement and handle with the matter and sell the property.
Mrs Grace López acquired a one bedroom apartment in Belvedere in June 2010. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be to prolong the lease by an additional years. Comparative residencies in Belvedere with a long lease were worth £295,000. The mid-range ground rent payable was £45 billed annually. The lease finished in 2098. Having 74 years unexpired we calculated the compensation to the landlord for the lease extension to be between £8,600 and £9,800 plus fees.
An example of a Lease Extension decision for a Belvedere premises is Various @ Colombus Square in January 2012. the Tribunal calculated the premiums to be paid for new leases for each of the flats in Mariners Walk to be £3822 and the premium to be paid for the new lease of 2 Knights Court to be £4439. This case related to 13 flats. The unexpired residue of the current lease was 76 years.