It’s an underpublicised truth that a Teddington 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 early years due to the loss of value being disguised by increases in the Teddington property market.Where your lease has approximately ninety years left, you need to start thinking about 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 dips below eighty years - otherwise a higher premium will be payable. Most flat owners in Teddington will be able to extend under the legislation; however a conveyancer should be able to confirm whether you are eligibility. In some situations you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the formalities.
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years left, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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. |
| Godiva Mortgages | 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Engaging our service gives you enhanced control over the value of your Teddington leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Twenty four months ago Owen, started to get close to the eighty-year threshold with the lease on his two bedroom apartment in Teddington. Having purchased his flat 18 years previously, the lease term was of little significance. As luck would have it, it dawned on him that he needed to take action soon on a lease extension. Owen extended the lease just under the wire in April. Owen and the landlord eventually settled on sum of £5,500 . If he had missed the deadline, the price would have gone up by a minimum £925.
Last Autumn we were phoned by Ms E Young , who bought a purpose-built flat in Teddington in July 2003. The dilemma was if we could estimate the price would likely be to extend the lease by ninety years. Comparative homes in Teddington with 100 year plus lease were valued around £201,200. The average amount of ground rent was £55 billed per annum. The lease elapsed on 18 September 2082. Taking into account 56 years remaining we calculated the premium to the freeholder to extend the lease to be between £31,400 and £36,200 not including fees.
An example of a Lease Extension matter before the tribunal for a Teddington premises is Flat D 15 Claremont Gardens in September 2013. TheTribunal determined in accordance with section48 and Schedule13 of the Leasehold Reform,Housing and Urban Development Act 1993 that the premium for the extended lease should be fourteen thousand one hundred and eighty seven pounds (£14,187.00) This case was in relation to 1 flat.