For anyone whose Belsize Park flat is held on a long lease, our message is clear – if you ignore the situation, the property will ultimately revert to the freeholder, leaving you empty-handed. The shorter the lease the lower the value of the property and the more it will cost to obtain a lease extension.
Leasehold residencies in Belsize Park with over one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth 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 justify 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. |
| 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. |
| 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 |
Retaining our service will provide you better control over the value of your Belsize Park leasehold, as your property will be more valuable and saleable 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.
In the wake of 6 months of unsuccessful discussions with the landlord of her first floor flat in Belsize Park, Bethan commenced the lease extension process as the 80 year deadline was swiftly coming. The transaction was finalised in May 2012. The landlord’s fees were kept to an absolute minimum.
Last Winter we were approach by Mr and Mrs. H García , who was assigned a lease of a one bedroom flat in Belsize Park in March 2004. The dilemma was if we could approximate the compensation to the landlord would be to prolong the lease by a further 90 years. Comparative homes in Belsize Park with 100 year plus lease were worth £280,000. The mid-range amount of ground rent was £45 collected per annum. The lease expiry date was on 9 February 2095. Having 69 years remaining we estimated the premium to the freeholder for the lease extension to be within £12,400 and £14,200 exclusive of professional charges.
An example of a Lease Extension decision for a Belsize Park property is First Floor Flat 20 Fitzjohns Avenue in July 2014. the Tribunal decided that the premiums to be paid for new leases in respect of the Raised Ground Floor Flat and the First Floor Flat were to be calculated as: Raised Ground Floor: £765,175.14 First Floor: £601,617.77 This case was in relation to 2 flats. The unexpired term as at the valuation date was 16.83 and 16.43.