Unfortunately that a Blackfriars 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 first few years due to the loss of value being disguised by increases in the Blackfriars property market.Where your lease has approximately 90 years left, you should 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 slips under 80 years - otherwise a higher amount will be payable. The majority of flat owners in Blackfriars will be able to extend under the legislation; however a lawyer will be able to clarify if you qualify for an extension. 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.
Leasehold premises in Blackfriars with more than 100 years left 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 property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must also be not less than 75 years at the outset of the mortgage. |
| 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. |
Lease extensions in Blackfriars can be a difficult process. We recommend you get guidance from a conveyancing solicitor and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience procuring Blackfriars lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Off the back of lengthy negotiations with the landlord of her leasehold apartment in Blackfriars, Lauren started the lease extension process just as the lease was coming close to the crucial eighty-year mark. The legal work was finalised in September 2011. The landlord’s charges were restricted to a tad over 600 pounds.
Last April we were approach by Dr R Bernard , who acquired a purpose-built apartment in Blackfriars in August 2009. The question was if we could approximate the premium would likely be for a ninety year extension to my lease. Comparative residencies in Blackfriars with a long lease were worth £255,000. The average amount of ground rent was £50 invoiced every twelve months. The lease concluded on 13 June 2095. Considering the 70 years as a residual term we approximated the compensation to the landlord for the lease extension to be within £10,500 and £12,000 not including costs.
An example of a Lease Extension decision for a Blackfriars residence 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 affected 1 flat. The unexpired term as at the valuation date was 66.8 years.