It’s an underpublicised certainty that a Belvedere residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Belvedere property market.Where your lease has approximately 90 years left, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls lower than eighty years - otherwise a higher amount will be payable. Most flat owners in Belvedere will be able to extend under the legislation; however a lawyer should be able to clarify whether you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your conveyancer from beginning to end of the process.
It is conventional wisdom that a residential leasehold with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 45 years left, the property will be worth the same as 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
Regardless of whether you are a tenant or a landlord in Belvedere,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Belvedere valuers.
Toby was the the leasehold owner of a conversion apartment in Belvedere on the market with a lease of fraction over 61 years unexpired. Toby on an informal basis contacted his freeholder being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent initially set at £100 per annum and increase every 25 years thereafter. No ground rent would be due on a lease extension were Toby to invoke his statutory right. Toby obtained expert legal guidance and secured an acceptable resolution without resorting to tribunal and readily saleable.
Last Winter we were phoned by Mr and Mrs. U Díaz , who moved into a recently refurbished flat in Belvedere in July 2001. 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 Belvedere with 100 year plus lease were worth £205,000. The mid-range ground rent payable was £50 collected every twelve months. The lease end date was in 2104. Considering the 79 years unexpired we calculated the premium to the landlord for the lease extension to be within £8,600 and £9,800 plus expenses.
An example of a Lease Extension decision for a Belvedere residence is Various @ Colombus Square in January 2012. the Tribunal calculated the premiums to be paid for new leases for each of the flats in Mariners Walk to be £3822 and the premium to be paid for the new lease of 2 Knights Court to be £4439. This case was in relation to 13 flats. The remaining number of years on the lease was 76 years.