Totteridge residential property owned on a long lease is a wasting asset as the leaseholder only owns the property for a set term.
Leasehold residencies in Totteridge with over one hundred years outstanding on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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. |
The conveyancers that we work with handle Totteridge 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.
Charlie was the the leasehold owner of a conversion apartment in Totteridge on the market with a lease of a few days over sixty years unexpired. Charlie on an informal basis contacted his freeholder a well known Bristol-based freehold company for a lease extension. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a rise in the rent to £200 annually. Ordinarily, ground rent would not be payable on a lease extension were Charlie to invoke his statutory right. Charlie procured expert legal guidance and was able to make an informed judgement and deal with the matter and ending up with a market value flat.
Last May we were e-mailed by Mrs O Díaz , who completed a first floor apartment in Totteridge in June 2008. We are asked if we could estimate the premium could be for a 90 year lease extension. Identical premises in Totteridge with a long lease were in the region of £225,800. The mid-range amount of ground rent was £60 invoiced per annum. The lease ran out in 2086. Given that there were 60 years as a residual term we estimated the premium to the freeholder for the lease extension to be within £23,800 and £27,400 exclusive of expenses.
An example of a Lease Extension matter before the tribunal for a Totteridge residence is Flat 2 2 Netherfield Road in April 2010. The Tribunale held that premium payable for a 90 year extension to the existing Lease should be £7,705. This case was in relation to 1 flat. The number of years remaining on the existing lease(s) was 76 years.