With a domestic leasehold premises in Barbican, you effectively rent it for a certain period of time. These days flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a long period of time, you should consider a lease extension sooner as opposed to later. Accepted thinking is that the shorter the lease is the cost of extending the lease gets disproportionately more expensive particularly when there are less than eighty years left. Leasehold owners in Barbican with a lease drawing near to 81 years unexpired should seriously consider extending it sooner as opposed to later. When the lease term has below 80 years outstanding, under the current legislation the landlord can calculate and levy a larger premium, based on a technical computation, known as “marriage value” which is due.
Leasehold premises in Barbican with over 100 years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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 undertake 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 conveyancing solicitor we work with provide it.
Two years ago Theo, came very near to the 80-year threshold with the lease on his leasehold flat in Barbican. Having purchased his home 18 years ago, the unexpired term was of no relevance. Fortunately, he became aware that he needed to take steps soon on Extending the lease. Theo arranged for a lease extension at the eleventh hour in April. Theo and the landlord who owned the flat above ultimately settled on an amount of £5,000 . If he failed to meet the deadline, the sum would have become more costly by at least £1,025.
In 2012 we were e-mailed by Mrs K Pérez who, having was assigned a lease of a one bedroom flat in Barbican in September 2003. The question was if we could shed any light on how much (approximately) price would likely be for a ninety year lease extension. Identical flats in Barbican with a long lease were in the region of £250,000. The average ground rent payable was £50 collected quarterly. The lease ran out in 2094. Having 69 years remaining we approximated the premium to the landlord to extend the lease to be within £9,500 and £11,000 exclusive of expenses.
An example of a Lease Extension case for a Barbican flat 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.