Unfortunately that a Teddington residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the depreciation being disguised by increases in the Teddington property market.Where your lease has approximately ninety years left, you need to start considering 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 slips under 80 years - otherwise a higher amount will be payable. Most leasehold owners in Teddington will be able to extend under the legislation; however a conveyancer will be able to confirm if you are eligibility. In some cases you may not be entitled. There are also strict timetables and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancing solicitor throughout the formalities.
It is generally considered 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 any lease with more than 45 years remaining, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
The conveyancers that we work with undertake Teddington lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
In recent months Hunter, came seriously close to the 80-year mark with the lease on his ground floor flat in Teddington. In buying his home two decades ago, the lease term was of little significance. Luckily, he noticed he needed to take steps soon on a lease extension. Hunter extended the lease at the eleventh hour last January. Hunter and the freeholder via the managing agents eventually agreed on the final figure of £5,500 . If he not met the deadline, the figure would have become more exhorbitant by a minimum £1,100.
Dr C Martin completed a purpose-built flat in Teddington in March 2001. The question was if we could estimate the premium could be for a 90 year lease extension. Comparative premises in Teddington with an extended lease were valued around £181,600. The average amount of ground rent was £55 billed yearly. The lease terminated in 2077. Considering the 52 years unexpired we approximated the premium to the freeholder to extend the lease to be between £30,400 and £35,200 plus costs.
An example of a Lease Extension matter before the tribunal for a Teddington flat 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 affected 1 flat.