The market value of a leasehold property in Brook Green is impacted by how many years the lease has remaining. If it is close to or less than eighty years you should expect problems on re-sale, so it is recommended to arrange for the lease to be extended ahead of buying. It is ideal to start the process of extending the lease is when a lease still has 82 years to run so that all matters can be concluded ahead of the 80 year mark. Current legislation entitles Brook Green qualifying lessees to an additional term of ninety years over and above the existing term, at a peppercorn rent (zero ground rent). The reason of the valuation is to determine the premium payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold premises in Brook Green with over one hundred years remaining on the lease are sometimes referred to as ‘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 upside in buying the reversionary interest unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
The conveyancing solicitors that we work with undertake Brook Green 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.
In 2014 Lucas, came very near to the 80-year mark with the lease on his basement flat in Brook Green. Having purchased his flat two decades ago, the unexpired term was of no concern. Fortunately, he realised he would soon be paying an inflated amount for a lease extension. Lucas was able to extend his lease at the eleventh hour in May. Lucas and the freeholder via the management company ultimately settled on sum of £6,000 . If the lease had dipped below 80 years, the price would have escalated by at least £1,075.
Dr Daisy Petit was assigned a lease of a basement apartment in Brook Green in June 1999. We are asked if we could shed any light on how much (roughly) premium could be to prolong the lease by 90 years. Comparative residencies in Brook Green with a long lease were worth £216,000. The mid-range amount of ground rent was £60 billed every twelve months. The lease elapsed on 5 September 2084. Considering the 58 years remaining we calculated the compensation to the landlord for the lease extension to be between £28,500 and £33,000 plus professional charges.
An example of a Freehold Enfranchisement case for a Brook Green property is 83 Sinclair Road in September 2010. The decision of the Tribunal was that the price to be paid by the Applicant to the Respondent for the freehold interest in the Property was the sum of £93,650 This case was in relation to 4 flats. The remaining number of years on the lease was 70.58 years.