Kew leases on residential deteriorating in value. if your lease has about 90 years remaining, you should start thinking about a lease extension. If lease term falls under eighty years, you will then be required to pay 50% of the property's 'marriage value' on top of the usual cost of the lease extension to your landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Leasehold owners in Kew will usually be legally entitled to a lease extension; however a solicitor will confirm your eligibility. In certain situations you may not qualify. There are also strict timetables and steps to follow once the process is triggered so it’s sensible to be guided by a conveyancer during the process.
It is conventional wisdom that a property with in excess of one hundred years remaining is worth roughly the equivalent 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 decades to come.
| Lender | Requirement |
|---|---|
| Chelsea 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with handle Kew lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Two years ago Muhammad, started to get near to the eighty-year threshold with the lease on his garden apartment in Kew. In buying his property twenty years ago, the length of the lease was of minimal bearing. As luck would have it, he realised he would soon be paying an inflated amount for a lease extension. Muhammad arranged for a lease extension at the eleventh hour in March. Muhammad and the freeholder in the end settled on a premium of £6,000 . If he had missed the deadline, the sum would have increased by a minimum £950.
Mr Mason Clark owned a ground floor flat in Kew in October 2001. The dilemma was if we could approximate the compensation to the landlord would be to prolong the lease by a further 90 years. Comparative residencies in Kew with 100 year plus lease were valued around £210,000. The mid-range ground rent payable was £50 collected quarterly. The lease expired on 4 September 2106. Having 80 years as a residual term we estimated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 exclusive of fees.
An example of a Lease Extension case for a Kew premises is Flat 1 30 Ennismore Avenue in September 2010. the Tribunal adopted and arrived at a premium for the lease extension of £29, 900 This case was in relation to 1 flat. The unexpired term was 68.34 years.