When it comes to residential leasehold property in Barbican, you are in fact renting it for a certain amount of time. Modern flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you may think about extending the lease sooner as opposed to later. The general rule is that the shorter the number of years is the cost of extending the lease becomes disproportionately more expensive especially when there are less than 80 years left. Residents in Barbican with a lease nearing 81 years left should seriously consider extending it sooner than later. When the lease term has under 80 years remaining, under the current statute the landlord is entitled to calculate and charge a greater premium, based on a technical calculation, strangely termed as “marriage value” which is due.
Leasehold properties in Barbican with over 100 years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges merit it.
| 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. |
| Coventry Building Society | 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with handle Barbican 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 conveyancer we work with provide it.
During the course of the last few months Owen, came precariously near to the eighty-year mark with the lease on his leasehold apartment in Barbican. In buying his flat twenty years ago, the unexpired term was of minimal concern. Luckily, he realised he needed to take steps soon on Extending the lease. Owen was able to extend his lease just ahead of time in September. Owen and the freeholder subsequently settled on the final figure of £6,000 . If he failed to meet the deadline, the price would have increased by at least £925.
Last Christmas we were approach by Mr and Mrs. C James , who moved into a recently refurbished flat in Barbican in September 2008. We are asked if we could shed any light on how much (roughly) premium could be for a ninety year extension to my lease. Similar flats in Barbican with 100 year plus lease were in the region of £275,000. The mid-range ground rent payable was £55 invoiced per annum. The lease elapsed on 11 January 2103. Given that there were 77 years as a residual term we estimated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 plus expenses.
An example of a Lease Extension matter before the tribunal for a Barbican residence 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 was in relation to 2 flats. The remaining number of years on the lease was 72.39 years.