Kennington leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Legislation has been in place for sometime now which permits qualifying Kennington residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Kennington you really ought to check if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under eighty years, the amount payable for any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| 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 |
Regardless of whether you are a tenant or a landlord in Kennington,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Kennington valuers.
Trailing lengthy correspondence with the landlord of her first floor flat in Kennington, Stephanie started the lease extension process as the 80 year deadline was fast advancing. The legal work completed in October 2006. The freeholder’s charges were negotiated to slightly above 500 pounds.
Last month we were approach by Mrs Lauren Mitchell , who moved into a newly refurbished apartment in Kennington in March 1999. The question was if we could shed any light on how much (roughly) price would likely be to extend the lease by an additional years. Comparable properties in Kennington with an extended lease were in the region of £206,200. The mid-range amount of ground rent was £60 billed per annum. The lease terminated in 2081. Considering the 56 years left we approximated the compensation to the landlord to extend the lease to be within £31,400 and £36,200 not including legals.
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 was in relation to 1 flat. The unexpired lease term was 74.77 years.