Biggin Hill residential property owned on a long lease is a wasting asset as the leaseholder merely owns the property for a set term.
Leasehold properties in Biggin Hill with over 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 property. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 |
| Yorkshire 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. |
The lawyers that we work with undertake Biggin Hill 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 conveyancer we work with provide it.
Finley was the the leasehold owner of a 2 bedroom flat in Biggin Hill on the market with a lease of fraction over 72 years left. Finley informally approached his freeholder a well known Manchester-based freehold company for a lease extension. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £100 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Finley to exercise his statutory right. Finley procured expert advice and was able to make a more informed decision and deal with the matter and ending up with a market value flat.
Last month we were e-mailed by Dr Logan Brown , who was assigned a lease of a purpose-built flat in Biggin Hill in July 2006. The question was if we could shed any light on how much (roughly) price would be to extend the lease by 90 years. Comparable flats in Biggin Hill with an extended lease were worth £191,400. The mid-range amount of ground rent was £55 invoiced annually. The lease came to a finish on 2 October 2080. Taking into account 54 years outstanding we approximated the premium to the freeholder for the lease extension to be within £34,200 and £39,600 not including legals.
An example of a Lease Extension matter before the tribunal for a Biggin Hill residence is 1 Southlands Court Southlands Road in September 2013. The Leasehold Valuation Tribunal determined that the premium to be paid by the tenant on the grant of a new lease, in accordance with section 56 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 was £30,541 This case related to 1 flat. The unexpired term was 50.57 years.