It’s an underpublicised certainty that a Hammersmith residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the first few years due to the reduction being disguised by increases in the Hammersmith property market.Where your lease has approximately 90 years left, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips lower than eighty years - otherwise a higher premium will be due. Most flat owners in Hammersmith will be able to extend under the legislation; however a conveyancer should be able to confirm whether you are eligibility. In some cases you may not be entitled. There are also strict timeframes and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor for the duration of the formalities.
Leasehold premises in Hammersmith with more than 100 years remaining on the lease are sometimes referred to as ‘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 upside in purchasing the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service gives you enhanced control over the value of your Hammersmith leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of unsuccessful negotiations with the landlord of her one bedroom flat in Hammersmith, Katherine initiated the lease extension process just as her lease was approaching the all-important 80-year mark. The lease extension was concluded in September 2009. The landlord’s fees were kept to an absolute minimum.
In 2014 we were contacted by Mr Toby White who, having completed a one bedroom flat in Hammersmith in February 1997. We are asked if we could estimate the premium could be to extend the lease by 90 years. Identical properties in Hammersmith with a long lease were valued about £255,000. The mid-range amount of ground rent was £50 billed yearly. The lease ended in 2096. Taking into account 70 years left we calculated the premium to the landlord for the lease extension to be within £9,500 and £11,000 plus professional charges.
An example of a Freehold Enfranchisement case for a Hammersmith flat is 19 Crisp Road in June 2009. Following a vesting order (Under section 26 of the Leasehold Reform,Housing and Urban Development Act 1993) The tribunal determined that the premium payable for the acquisition of the freehold was £33,756,apportioned as to£12,285 for the lower at and £21,471for the upper fat. This case was in relation to 2 flats. The unexpired term as at the valuation date was 68.32 years.