It’s an underpublicised truth that a Kew residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Kew property market.Where your lease has approximately 90 years left, you need to start thinking about a lease extension. If the number of years remaining slips under 80 years, you will end up paying half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Kew will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify if you qualify for an extension. In some cases you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
It is conventional wisdom that a property with more than one hundred years remaining is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Using our service will provide you increased control over the value of your Kew leasehold, as your property will be more valuable and saleable in respect of lease length should you wish to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
In 2014 Alexander, started to get close to the 80-year threshold with the lease on his ground floor flat in Kew. In buying his home two decades ago, the unexpired term was of little concern. As luck would have it, he became aware that he needed to take steps soon on a lease extension. Alexander extended the lease just in the nick of time last August. Alexander and the freeholder via the management company subsequently settled on sum of £5,000 . If the lease had gone lower than eighty years, the premium would have become more costly by at least £1,075.
Last Christmas we were called by Mr and Mrs. W Reed , who moved into a first floor flat in Kew in May 2006. The question was if we could shed any light on how much (roughly) premium would likely be for a ninety year lease extension. Similar homes in Kew with 100 year plus lease were worth £171,800. The mid-range ground rent payable was £55 collected monthly. The lease ended in 2076. Considering the 50 years left we approximated the premium to the freeholder to extend the lease to be within £33,300 and £38,400 plus fees.
An example of a Lease Extension case for a Kew residence 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 number of years remaining on the existing lease(s) was 68.34 years.