Owning a flat usually means owning a lease of the property, which has a set term of years. This lease will normally be granted for a prescribed period of time , usually 99 or 125 years, although we have witnessed longer and shorter terms in Blackfriars. Inevitably, the length of lease remaining shortens as time goes by. This is often ignored and only raises itself as an issue when the flat or house has to be disposed of or refinanced. The shorter the lease the less it is worth and the more expensive it will be to extend the lease. Eligible leaseholders in Blackfriars have the right to extend the lease for a further 90 years in accordance with legislation. Do give due attention before putting off your Blackfriars lease extension. Putting off that expense now only increases the price you will eventually have to pay to extend your lease
Leasehold properties in Blackfriars with in excess of 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges merit 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 Blackfriars 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 conveyancing solicitor we work with provide it.
Lucas was the the leasehold owner of a high value flat in Blackfriars being sold with a lease of a few days over 61 years unexpired. Lucas on an informal basis spoke with his freeholder being a well known Bristol-based freehold company for a lease extension. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £100 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Lucas to invoke his statutory right. Lucas obtained expert advice and secured satisfactory deal informally and ending up with a market value flat.
Last April we were called by Dr P Patel , who was assigned a lease of a purpose-built flat in Blackfriars in June 2011. We are asked if we could shed any light on how much (roughly) price would likely be to extend the lease by ninety years. Similar flats in Blackfriars with 100 year plus lease were in the region of £183,600. The mid-range ground rent payable was £65 billed yearly. The lease finished in 2083. Considering the 57 years as a residual term we calculated the compensation to the freeholder for the lease extension to be within £28,500 and £33,000 plus costs.
An example of a Lease Extension case for a Blackfriars premises is Flat 89 Trinity Court Grays Inn Road in February 2013. the Tribunal found that the premium to be paid by the tenant on the grant of a new lease, in accordance with section 56 and Schedule 13 to the Leasehold Reform, Housing and Urban Development Act 1993 should be £36,229. This case related to 1 flat. The unexpired residue of the current lease was 66.8 years.