The value of Bexley leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can increase materialy once the unexpired lease term is below than 80 years
Leasehold residencies in Bexley with in excess of 100 years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. 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 |
|---|---|
| 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; |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with procure Bexley 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 lawyer we work with provide it.
Trailing unsuccessful correspondence with the landlord of her basement flat in Bexley, Jodie commenced the lease extension process as the eighty year threshold was swiftly nearing. The legal work completed in October 2009. The freeholder’s costs were restricted to a tad over 550 pounds.
In 2012 we were called by Mrs Ellie Moreau who, having took over the lease of a one bedroom apartment in Bexley in July 1995. The dilemma was if we could approximate the compensation to the landlord could be to extend the lease by a further 90 years. Comparative residencies in Bexley with a long lease were valued about £174,200. The mid-range ground rent payable was £55 billed yearly. The lease terminated in 2077. Considering the 51 years left we estimated the premium to the freeholder for the lease extension to be between £31,400 and £36,200 exclusive of fees.
An example of a Lease Extension decision for a Bexley flat is 103a Footscray Road in January 2014. The tribunal determines that the premium payable for the extended lease should be £34,500 according to the expert witness valuation calculation This case related to 1 flat.