Owning a flat 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 prescribed period of time , usually 99 or 125 years, although we have witnessed longer and shorter terms in Shadwell. Clearly, the term of lease left shortens as time goes by. This is often overlooked and only becomes a problem when the residence needs to be disposed of or refinanced. The shorter the lease the less it is worth and the more expensive it will be to procure a lease extension. Eligible leaseholders in Shadwell have the legal entitlement to extend the lease for a further 90 years under Leasehold Reform legislation. Please give due consideration before putting off your Shadwell lease extension. Putting off the cost now only increases the price you will eventually have to pay for a lease extension
It is conventional wisdom that a residential leasehold with more than 100 years unexpired lease term is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Lease extensions in Shadwell can be a difficult process. We recommend you get guidance from a conveyancer and surveyor with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Shadwell lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Liam was the the leasehold owner of a high value flat in Shadwell on the market with a lease of a little over sixty years outstanding. Liam on an informal basis contacted his landlord being a well known local-based freehold company for a lease extension. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £200 annually. No ground rent would be payable on a lease extension were Liam to invoke his statutory right. Liam obtained expert legal guidance and secured satisfactory deal without going to tribunal and ending up with a market value flat.
Last Christmas we were phoned by Mr and Mrs. F Morgan , who acquired a recently refurbished apartment in Shadwell in February 2012. The dilemma was if we could estimate the premium would likely be for a ninety year lease extension. Comparable properties in Shadwell with an extended lease were in the region of £243,000. The mid-range amount of ground rent was £65 invoiced monthly. The lease concluded on 2 February 2088. Having 63 years outstanding we calculated the premium to the freeholder to extend the lease to be within £20,000 and £23,000 not including fees.
An example of a Freehold Enfranchisement case for a Shadwell premises is 12, 14 & 16 Hull Close in May 2010. the Tribunal determined that the premium payable for the acquisition of the freehold to the subject premises was the sum of £18,300 This case affected 3 flats. The remaining number of years on the lease was 101.61 years.