Notting Hill leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. It is the case that most Notting Hill tenants have the right to extend their lease by an additional ninety years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in Notting Hill you would be well advised to check if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under eighty years, the cost of any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
Leasehold properties in Notting Hill with more than one hundred years left on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges warrant 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
The lawyers that we work with handle Notting Hill 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.
Omar owned a high value flat in Notting Hill being sold with a lease of just over 59 years unexpired. Omar on an informal basis contacted his landlord a well known Manchester-based freehold company for a lease extension. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £125 yearly. No ground rent would be payable on a lease extension were Omar to invoke his statutory right. Omar obtained expert advice and was able to make a more informed judgement and deal with the matter and ending up with a market value flat.
Ms Rosie Brooks owned a ground floor flat in Notting Hill in March 1996. The dilemma was if we could estimate the premium would be for a 90 year extension to my lease. Similar properties in Notting Hill with a long lease were in the region of £270,000. The mid-range ground rent payable was £55 collected every twelve months. The lease terminated in 2100. Taking into account 74 years unexpired we calculated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 not including legals.
An example of a Lease Extension matter before the tribunal for a Notting Hill property is 2 Grove House 95 Addison Road in October 2013. the Tribunal decided that the premium to bepaid for a new lease is £50,050. This case was in relation to 1 flat. The unexpired residue of the current lease was 68.4 years.