Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will ordinarily be granted for a set period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Notting Hill. Inevitably, the term of lease remaining shortens as time goes by. This is often overlooked and only raises itself as an issue when the flat or house has to be sold or re-mortgaged. The fewer the years remaining the lower the value of the property and the more expensive it will be to obtain a lease extension. Eligible long lease owners in Notting Hill have the legal entitlement to extend the lease for a further 90 years under legislation. Please give careful attention before delaying your Notting Hill lease extension. Putting off the cost now only increases the price you will ultimately incur to extend your lease
It is generally accepted that a property with more than 100 years unexpired lease term is worth approximately the equivalent 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 |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| 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. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Irrespective of whether you are a tenant or a landlord in Notting Hill,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Notting Hill valuers.
Nathaniel owned a studio flat in Notting Hill being sold with a lease of fraction over fifty eight years remaining. Nathaniel informally approached his landlord being a well known Bristol-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years on the basis of a new rent initially set at £200 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Nathaniel to exercise his statutory right. Nathaniel procured expert advice and secured satisfactory deal without resorting to tribunal and readily saleable.
Last month we were called by Mr and Mrs. M Flores , who moved into a basement flat in Notting Hill in April 2012. We are asked if we could estimate the price would be to extend the lease by ninety years. Similar residencies in Notting Hill with 100 year plus lease were valued about £227,800. The average amount of ground rent was £45 invoiced quarterly. The lease ran out in 2090. Considering the 65 years left we estimated the compensation to the freeholder to extend the lease to be within £13,300 and £15,400 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.