Belvedere leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease becomes more expensive. Most owners of residential leasehold property in Belvedere enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Belvedere you must check if your lease has between 70 and 90 years remaining. There are compelling reasons why a Belvedere flat owner with a lease having around 80 years left should take steps to make sure that a lease extension is put in place without delay
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 45 years remaining, the premises will be equivalent in value to a freehold for many years in the future.
|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.|
|Birmingham Midshires|| Minimum 70 years from the date of the mortgage.|
|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.|
|Halifax|| Minimum 70 years from the date of the mortgage.|
|The Mortgage Works|| Minimum unexpired lease term is 70 years with 30 years remaining at the end of the mortgage term. Report to the issuing office if the lease term is shorter than that stated within the Offer and has less than 100 years remaining.(There is no requirement to report if the lease term is lower than that stated on the Offer but still has 100 years or more to run, or if the lease term is longer than that stated on the Offer).|
NEW BUILD PROPERTIES (includes office conversions)
The following are not acceptable:
- The unexpired lease term on a new build flat is less than 125 years
- The unexpired lease term on a new build house is less than 250 years
- Starting ground rent is more than 0.1% of the property value
The lease must be amended to comply with the above. If not the case cannot proceed. Please advise us where the case cannot proceed.
Ground rents and event fees:
Ground rent and other event fees must be reasonable at all times during the lease term. For example, it is acceptable for ground rent escalation to be linked to RPI (Retail Price Index) or a similar index and where this is the case we do not need to be advised. However, unreasonable multipliers of ground rent will not be permitted, for example, doubling every 5, 10 or 15 years. These must be referred to us and we will advise if our mortgage offer remains valid. If you are unsure as to whether the terms of a lease are unreasonable, please refer the details to us.
Engaging our service will provide you increased control over the value of your Belvedere leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Last October Samuel, started to get close to the 80-year mark with the lease on his basement apartment in Belvedere. In buying his home two decades ago, the lease term was of little bearing. Thankfully, he recognised he would soon be paying way over the odds for Extending the lease. Samuel arranged for a lease extension just ahead of time in June. Samuel and the freeholder in the end settled on sum of £5,000 . If the lease had dropped below eighty years, the price would have gone up by at least £1,000.
Mrs C Richardson was assigned a lease of a ground floor flat in Belvedere in July 2001. We are asked if we could approximate the compensation to the landlord would be for a ninety year lease extension. Identical residencies in Belvedere with a long lease were valued around £216,000. The average amount of ground rent was £60 invoiced yearly. The lease expired on 7 March 2077. Taking into account 58 years remaining we calculated the premium to the landlord to extend the lease to be between £28,500 and £33,000 exclusive of fees.
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 unexpired term as at the valuation date was 76 years.