Unfortunately that a Rise Park residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the Rise Park property market.Where your lease has approximately 90 years left, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls lower than 80 years - otherwise a higher amount will be payable. The majority of leasehold owners in Rise Park will be able to extend under the legislation; however a lawyer should be able to clarify whether you qualify for an extension. In some cases you may not be entitled. There are also strict timetables and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer for the duration of the process.
Leasehold properties in Rise Park with over one hundred years left on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Regardless of whether you are a tenant or a freeholder in Rise Park,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 in-depth market knowledge and the close ties they enjoy with Rise Park valuers.
Trailing protracted discussions with the freeholder of her purpose-built flat in Rise Park, Morgan started the lease extension process just as the lease was nearing the crucial 80-year mark. The lease extension completed in October 2007. The freeholder’s costs were kept to an absolute minimum.
Last Spring we were approach by Dr T González , who moved into a one bedroom apartment in Rise Park in June 1997. The question was if we could approximate the premium would be to prolong the lease by ninety years. Similar properties in Rise Park with a long lease were in the region of £205,000. The mid-range ground rent payable was £50 billed monthly. The lease expired on 25 March 2103. Given that there were 78 years as a residual term we estimated the premium to the landlord to extend the lease to be within £7,600 and £8,800 exclusive of fees.
An example of a Lease Extension case for a Rise Park property is Flat b 14 Kemble Road in May 2014. The Tribunal assessed the value of the premium payable for the lease extension to be £9,761 This case related to 1 flat.