When it comes to domestic leasehold property in Islington, you are actually buying a right to reside in a property for a set period of time. Modern flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you should consider extending the lease sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease becomes disproportionately greater especially when there are fewer than eighty years left. Leasehold owners in Islington with a lease approaching 81 years unexpired should seriously consider extending it sooner rather than later. When the lease term has below 80 years outstanding, under the current statute the landlord can calculate and demand a larger premium, assessed on a technical calculation, known as “marriage value” which is due.
Leasehold properties in Islington with over 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 situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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. |
| Godiva Mortgages | 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a landlord in Islington,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Islington valuers.
Kyle was the the leasehold proprietor of a high value apartment in Islington on the market with a lease of fraction over sixty years outstanding. Kyle informally spoke with his landlord being a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a new rent at the outset set at £150 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Kyle to exercise his statutory right. Kyle procured expert advice and secured an acceptable deal without going to tribunal and ending up with a market value flat.
Last month we were phoned by Mrs U Ricardo , who purchased a garden flat in Islington in May 2012. The question was if we could shed any light on how much (roughly) price would likely be to extend the lease by a further 90 years. Comparative flats in Islington with an extended lease were in the region of £174,200. The average ground rent payable was £55 collected yearly. The lease finished in 2077. Taking into account 51 years left we estimated the compensation to the freeholder to extend the lease to be within £31,400 and £36,200 not including legals.
An example of a Lease Extension matter before the tribunal for a Islington premises is 5C Stoke Newington Road in April 2010. the Tribunal therefore concludes that the premium to be paid for the extended lease is £700.00 This case affected 1 flat. The unexpired residue of the current lease was 80.5 years.