The closer a domestic lease in Mayfair gets to zero years unexpired, the the greater the reduction in the value of the property. If the lease has, in excess of 125 years remaining then this decrease may be of little impact nevertheless there will become a stage when a lease has under than 80 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 primary logic behind why you should extend the lease sooner than later. The majority of flat owners in Mayfair will qualify for this right; that being said a conveyancing solicitor can confirm if you qualify to extend your lease. In certain situations you may not qualify, the most common reason being that you have not been the owner of the property for two years.
Leasehold properties in Mayfair with more than one hundred years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset 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. |
Irrespective of whether you are a tenant or a landlord in Mayfair,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Mayfair valuers.
Off the back of lengthy negotiations with the freeholder of her one bedroom flat in Mayfair, Kelsey initiated the lease extension process as the 80 year deadline was rapidly nearing. The legal work was concluded in March 2008. The landlord’s charges were restricted to below 550 pounds.
In 2011 we were approached by Mr and Mrs. C Mason who, having purchased a first floor apartment in Mayfair in September 2000. The dilemma was if we could approximate the premium would be for a 90 year lease extension. Comparable residencies in Mayfair with an extended lease were valued around £176,200. The mid-range ground rent payable was £65 invoiced per annum. The lease end date was on 14 April 2082. Considering the 56 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £29,500 and £34,000 exclusive of fees.
An example of a Lease Extension decision for a Mayfair residence is Flat 1 3 Upper Belgrave Street in December 2010. The Tribunal determined that the price payablefor the Lease extension in respect of the subject premises was £2,202,007 This case affected 1 flat. The unexpired term was 21 years.