For anyone whose Belgravia property is held on a long lease, our message is clear – if you ignore the situation, the property will ultimately revert to your landlord, leaving you empty-handed. The shorter the lease the less it is worth and the more it will cost to extend the lease.
Leasehold residencies in Belgravia with in excess of 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 premises. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| 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. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with handle Belgravia 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.
Subsequent to unsuccessful discussions with the landlord of her first floor flat in Belgravia, Maisie initiated the lease extension process just as her lease was coming close to the crucial 80-year threshold. The transaction was concluded in August 2014. The landlord’s fees were kept to an absolute minimum.
Last Autumn we were approach by Ms P Hernández , who completed a ground floor flat in Belgravia in June 1996. We are asked if we could shed any light on how much (approximately) price would be for a ninety year lease extension. Comparable residencies in Belgravia with an extended lease were worth £193,400. The average amount of ground rent was £65 invoiced yearly. The lease end date was on 12 July 2082. Having 59 years as a residual term we calculated the compensation to the landlord for the lease extension to be between £21,900 and £25,200 plus professional charges.
An example of a Lease Extension case for a Belgravia property is Flat 3 47 Cadogan Square in December 2010. the Tribunal determined that the premium payable to the landord by the leaseholder for the lease extension was £732,935 This case was in relation to 1 flat. The unexpired term as at the valuation date was 13.33 years.