With a long leasehold premises in Aldermanbury, you effectively rent it for a certain amount of time. These days flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you should consider extending the lease sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease gets disproportionately more expensive notably once there are less than eighty years remaining. Residents in Aldermanbury with a lease nearing 81 years remaining should seriously consider extending it sooner as opposed to later. Once the lease term has below 80 years left, under the relevant statute the freeholder is entitled to calculate and demand a greater premium, based on a technical multiplication, known as “marriage value” which is due.
It is generally accepted that a property with more than one hundred years remaining is worth roughly the equivalent as a freehold. Where an further ninety 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. |
| 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. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
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Using our service gives you increased control over the value of your Aldermanbury leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
After protracted discussions with the landlord of her two bedroom flat in Aldermanbury, Naomi commenced the lease extension process just as her lease was approaching the crucial eighty-year deadline. The transaction was concluded in October 2007. The landlord’s charges were kept to an absolute minimum.
Last Autumn we were contacted by Dr L Bailey , who moved into a garden flat in Aldermanbury in May 2009. We are asked if we could shed any light on how much (approximately) compensation to the landlord would likely be to prolong the lease by 90 years. Identical homes in Aldermanbury with an extended lease were worth £290,000. The average ground rent payable was £45 billed every twelve months. The lease lapsed in 2099. Having 73 years unexpired we calculated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 exclusive of fees.
An example of a Lease Extension matter before the tribunal for a Aldermanbury property is 137 & 139 Haberdasher Street in December 2013. The Tribunal determines in accordance with section 48 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 that the premium for the extended lease for each Property should be £12,350.00. This case affected 2 flats. The unexpired term was 72.39 years.