When it comes to domestic leasehold premises in Blackfriars, you are actually purchasing an entitlement to reside in a property for a prescribed time frame. These days flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you may consider extending the lease sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease becomes disproportionately greater especially when there are fewer than 80 years left. Leasehold owners in Blackfriars with a lease nearing 81 years unexpired should seriously consider extending it without delay. When a lease has under eighty years remaining, under the current legislation the landlord is entitled to calculate and charge a larger amount, based on a technical calculation, known as “marriage value” which is due.
Leasehold properties in Blackfriars with in excess of one hundred years left on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
Lease extensions in Blackfriars can be a difficult process. We recommend you get guidance from a lawyer and surveyor well versed in the legislation and lease extension process.
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 dealing with Blackfriars lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Dylan was the the leasehold proprietor of a studio apartment in Blackfriars on the market with a lease of fraction over 61 years remaining. Dylan informally approached his landlord a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent to start with set at £100 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Dylan to invoke his statutory right. Dylan obtained expert advice and secured satisfactory deal informally and readily saleable.
Last Spring we were e-mailed by Mr and Mrs. A Roux , who completed a newly refurbished flat in Blackfriars in August 2006. The dilemma was if we could approximate the compensation to the landlord would likely be to prolong the lease by ninety years. Identical properties in Blackfriars with a long lease were worth £250,000. The mid-range ground rent payable was £50 billed yearly. The lease ran out on 9 May 2095. Given that there were 69 years remaining we calculated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 not including legals.
An example of a Lease Extension matter before the tribunal 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 related to 1 flat. The unexpired term as at the valuation date was 66.8 years.