As the the remaining lease term of a Kennington domestic lease lessens so does its value and therefore the value of your property. If the lease has, beyond 100 years remaining then this decrease may be negligible that being said there will become a point in time when a lease has less than eighty years unexpired 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 reason why you should extend the lease sooner rather than later. Many flat owners in Kennington will meet the qualifying criteria; nevertheless a conveyancing solicitor can advise whether you are eligible for a lease extension. In certain situations you may not qualify, the most common reason being that you have owned the property for under two years.
Leasehold residencies in Kennington with in excess of 100 years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in buying the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
| Yorkshire 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. |
Using our service will provide you increased control over the value of your Kennington leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Jack owned a studio apartment in Kennington being marketed with a lease of a little over sixty years remaining. Jack informally approached his landlord being a well known local-based freehold company for a lease extension. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £125 yearly. No ground rent would be due on a lease extension were Jack to exercise his statutory right. Jack procured expert advice and was able to make a more informed judgement and deal with the matter and sell the property.
In 2013 we were called by Dr W Bertrand who, having took over the lease of a one bedroom apartment in Kennington in June 2010. We are asked if we could shed any light on how much (approximately) price would likely be to extend the lease by an additional years. Comparable homes in Kennington with 100 year plus lease were in the region of £275,000. The average ground rent payable was £65 collected annually. The lease ended on 15 September 2094. Taking into account 68 years outstanding we approximated the premium to the landlord to extend the lease to be within £13,300 and £15,400 not including expenses.
An example of a Lease Extension decision for a Kennington premises is Ground Floor Flat 39 Bronsart Road in May 2010. Following a vesting order by West London County Court the Leasehold Valuation Tribunal concluded that the price to be paid for the extended lease of the premises was Thirteen Thousand Two hundred pounds (£13,200) in accordance with the valuation. The extended lease was granted for a term of 90 years from the expiry date of the Lease and at a peppercorn ground rent from the date of the vesting order. This case affected 1 flat. The unexpired term was 74.77 years.