Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will usually be granted for a set period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Vauxhall. Clearly, the term of lease left reduces as time goes by. This may slip by relatively unnoticed when the flat or house needs to be disposed of or re-mortgaged. The shorter the lease the lower the value of the property and the more expensive it will be to obtain a lease extension. Eligible leaseholders in Vauxhall have the legal entitlement to extend the lease for an additional 90 years in accordance with legislation. Do give due consideration before delaying your Vauxhall lease extension. Putting off that expense now likely increases the price you will ultimately incur to extend your lease
It is generally considered that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an additional ninety years added to any lease with more than 35 years remaining, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 will provide you better control over the value of your Vauxhall leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Sam owned a conversion flat in Vauxhall being marketed with a lease of a little over sixty years remaining. Sam informally spoke with his freeholder being a well known Manchester-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent initially set at £200 per annum and increase every 25 years thereafter. No ground rent would be due on a lease extension were Sam to exercise his statutory right. Sam procured expert advice and was able to make an informed decision and deal with the matter and readily saleable.
Dr A Rose bought a basement apartment in Vauxhall in July 2008. The question was if we could approximate the price would likely be to prolong the lease by ninety years. Comparative premises in Vauxhall with an extended lease were in the region of £290,000. The average amount of ground rent was £45 invoiced annually. The lease terminated in 2098. Taking into account 72 years as a residual term we estimated the premium to the freeholder for the lease extension to be within £11,400 and £13,200 plus fees.
An example of a Lease Extension matter before the tribunal for a Vauxhall residence is Flats 12A & 19, Evelyn Mansions Carlisle Place in June 2009. The Tribunal held that the price to be paid for the new lease of Flat 12A is £168,824, For the other flat the price was set at £169,110 This case related to 2 flats. The unexpired residue of the current lease was 56 years.