The value of Canary Wharf leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can increase materialy once the unexpired lease term is below than eighty years
Leasehold residencies in Canary Wharf with in excess of one hundred years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges merit 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. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 |
Lease extensions in Canary Wharf can be a difficult process. We recommend you obtain guidance from a conveyancing solicitor and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Canary Wharf lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Off the back of lengthy discussions with the landlord of her one bedroom flat in Canary Wharf, Mollie initiated the lease extension process as the 80 year deadline was rapidly coming. The legal work was concluded in January 2014. The landlord’s fees were kept to an absolute minimum.
Mr and Mrs. W Vincent was assigned a lease of a one bedroom flat in Canary Wharf in April 1995. We are asked if we could approximate the compensation to the landlord could be to extend the lease by an additional years. Comparative homes in Canary Wharf with 100 year plus lease were in the region of £208,600. The average amount of ground rent was £60 collected quarterly. The lease ran out in 2082. Given that there were 57 years as a residual term we calculated the compensation to the freeholder for the lease extension to be between £30,400 and £35,200 not including costs.
An example of a Freehold Enfranchisement matter before the tribunal for a Canary Wharf residence is 12, 14 & 16 Hull Close in May 2010. the Tribunal determined that the premium payable for the acquisition of the freehold to the subject premises was the sum of £18,300 This case related to 3 flats. The number of years remaining on the existing lease(s) was 101.61 years.