The re-sale value of a leasehold property in Brondesbury depends on how many years the lease has remaining. If it is close to or less than 80 years you should anticipate difficulties on re-sale, so it is advisable to arrange for the lease to be extended ahead of purchasing. Ideally one should start the lease extension process when the lease still has 82 years to run so that all matters can be concluded in advance of the eighty year mark. Current legislation entitles Brondesbury qualifying lessees to acquire a lease extension of 90 years in addition to the remaining lease term at a peppercorn rent (that is, rent free). The intention of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold residencies in Brondesbury with more than one hundred 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 property. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges merit 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. |
| 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. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Brondesbury,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Brondesbury valuers.
Last year William, started to get close to the 80-year mark with the lease on his one bedroom flat in Brondesbury. Having purchased his property 18 years previously, the lease term was of little bearing. As luck would have it, he noticed he would imminently be paying way over the odds for Extending the lease. William arranged for a lease extension at the eleventh hour in March. William and the freeholder in the end settled on a premium of £5,500 . If he not met the deadline, the sum would have increased by at least £850.
Mr Jason Bell moved into a one bedroom apartment in Brondesbury in August 2010. The question was if we could estimate the compensation to the landlord would be to extend the lease by ninety years. Similar flats in Brondesbury with a long lease were worth £210,000. The mid-range ground rent payable was £50 invoiced annually. The lease finished on 10 June 2104. Taking into account 79 years left we approximated the compensation to the freeholder for the lease extension to be between £8,600 and £9,800 not including professional charges.
An example of a Lease Extension matter before the tribunal for a Brondesbury premises is 50a Cavendish Road in April 2014. The Tribunal determines that the premium payable by the Applicant in respect of the extension of the lease for the flat was £82,319. This case related to 1 flat. The unexpired residue of the current lease was 49.26 years.