The only way is down when it comes to Soho lease terms. Soho flats that have a remaining term less than than eighty years will drop in value at a rapid rate, and the cost of extending your lease will go up.
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Regardless of whether you are a tenant or a landlord in Soho,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Soho valuers.
Last year Jasper, came seriously near to the 80-year threshold with the lease on his studio apartment in Soho. In buying his property two decades ago, the unexpired term was of little concern. As luck would have it, he noticed he would imminently be paying way over the odds for Extending the lease. Jasper extended the lease just ahead of time in July. Jasper and the landlord eventually settled on a premium of £5,500 . If he not met the deadline, the sum would have escalated by a minimum £950.
In 2009 we were e-mailed by Ms L Bell who, having owned a one bedroom apartment in Soho in June 2002. We are asked if we could estimate the premium would be to extend the lease by an additional years. Comparative premises in Soho with 100 year plus lease were in the region of £290,000. The average amount of ground rent was £45 invoiced quarterly. The lease terminated in 2097. Having 72 years outstanding we calculated the premium to the landlord for the lease extension to be between £11,400 and £13,200 not including legals.
An example of a Freehold Enfranchisement decision for a Soho property is 20 Avonwick Road in July 2013. The Tribunal was dealing with an application under Section 26 of the Leasehold Reform Housing and Urban Development Act 1993 for a determination of the freehold value of the property. It was concluded that the price to be paid was Fifteen Thousand Nine Hundred and Seventy (£15,970) divided as to £8,200 for Flat 20 and £7,770 for Flat 20A This case was in relation to 1 flat. The unexpired term as at the valuation date was 73.26 years.