Sydenham leases on residential deteriorating in value. Where your lease has in the region of 90 years unexpired, you should start considering the need for a lease extension. It is important to recognise that it is that it is desirable for your lease extension to take place before the term of the current lease drops lower than 80 years - otherwise a higher premium will be payable. Flat owners in Sydenham will usually qualify for a lease extension; however a solicitor will check your eligibility. In some circumstances you may not qualify. There are prescribed deadlines and steps to comply with once the process has commenced so it’s wise to be guided by a conveyancing solicitor during the process.
It is generally considered that a residential leasehold with more than 100 years remaining is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 35 years unexpired, the property will be equivalent in value to a freehold for many years in the future.
| 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Yorkshire 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. |
Using our service will provide you enhanced control over the value of your Sydenham leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Riley was the the leasehold proprietor of a high value apartment in Sydenham on the market with a lease of a little over sixty years remaining. Riley informally approached his landlord a well known local-based freehold company for a lease extension. The freeholder was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent initially set at £150 per annum and doubled every twenty five years thereafter. No ground rent would be payable on a lease extension were Riley to invoke his statutory right. Riley obtained expert advice and secured an acceptable resolution without resorting to tribunal and sell the property.
Last Spring we were phoned by Dr Oliver Baker , who owned a one bedroom flat in Sydenham in June 2001. The dilemma was if we could estimate the premium would likely be for a 90 year extension to my lease. Similar premises in Sydenham with 100 year plus lease were in the region of £256,600. The average amount of ground rent was £60 billed monthly. The lease ended in 2076. Having 52 years outstanding we estimated the compensation to the landlord for the lease extension to be between £39,000 and £45,000 plus fees.
An example of a Lease Extension matter before the tribunal for a Sydenham premises is Flat 5 4 Border Crescent in December 2013. the tribunal calculated that premium payable for the acquisition of a lease extension of the subject premises was in the sum of £14,900 (Fourteen thousand, nine hundred pounds). Those advising the applicant were advised to send a copy of the decision and a copy of the new lease with the premium (less the applicants costs as assessed by the Court) to the Croydon County Court (under claim number 3CR01226) for an officer of the Court to execute the new lease on behalf of the absentee landlord who is missing and cannot be traced). This case was in relation to 1 flat. The remaining number of years on the lease was 69 years.