The basic rule is, all other things holding equal, the shorter the lease the more expensive the premium. Qualifying leaseholders in Mile End may extend the lease for a further 90 years under Leasehold Reform legislation. Please think carefully before delaying your Mile End lease extension. Shelving the costs today simply increases the amount you will eventually have to pay to extend the lease.
It is conventional wisdom that a property with more than 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 45 years unexpired, the property will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Engaging our service will provide you increased control over the value of your Mile End leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of protracted discussions with the freeholder of her garden apartment in Mile End, Emma commenced the lease extension process as the eighty year threshold was rapidly advancing. The lease extension completed in January 2008. The freeholder’s fees were restricted to approximately 500 pounds.
Last Christmas we were phoned by Mr and Mrs. H Lefèvre , who owned a purpose-built apartment in Mile End in January 1999. We are asked if we could approximate the compensation to the landlord would be for a ninety year lease extension. Comparative properties in Mile End with a long lease were worth £206,200. The average amount of ground rent was £60 collected every twelve months. The lease concluded on 21 October 2081. Taking into account 56 years as a residual term we estimated the compensation to the landlord for the lease extension to be within £32,300 and £37,400 not including expenses.
An example of a Freehold Enfranchisement decision for a Mile End flat is 26 Rhondda Grove in June 2009. The net price payable by the leaseholders as determined by the Tribunal was £3,015.13. This comprised £11,300 premium for the reversion less £8,284.87 costs as ordered by the County Court.