The re-sale value of a leasehold property in Teddington is impacted by how many years the lease has remaining. If it is near to or fewer than 80 years you should anticipate problems on re-sale, so it is advisable to arrange for the lease to be extended ahead of buying. It is preferable to start the lease extension process when the lease still has 82 years remaining so that a lease extension can be addressed prior to the 80 year mark. Leasehold Reform legislation entitles Teddington qualifying lessees to acquire a new lease which will be for the current unexpired lease term plus an additional term of ninety years. The purpose of the valuation is to determine the premium payable by the lessee to the freeholder for the purchase of the lease extension.
It is generally accepted that a residential leasehold with over one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
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 decide to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Felix owned a studio flat in Teddington on the market with a lease of a little over sixty years unexpired. Felix informally approached his landlord being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a new rent at the outset set at £100 per annum and increase every 25 years thereafter. No ground rent would be due on a lease extension were Felix to invoke his statutory right. Felix procured expert legal guidance and was able to make a more informed judgement and handle with the matter and readily saleable.
Mr and Mrs. C Mercier bought a ground floor flat in Teddington in February 2003. We are asked if we could estimate the price would be for a ninety year lease extension. Comparative flats in Teddington with a long lease were valued around £295,000. The mid-range amount of ground rent was £45 invoiced every twelve months. The lease finished on 19 January 2100. Having 74 years outstanding we estimated the premium to the landlord to extend the lease to be between £9,500 and £11,000 plus professional charges.
An example of a Lease Extension decision for a Teddington property 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.