The re-sale value of a leasehold property in Burnt Oak is impacted by how many years the lease has left to run. If it is close to or fewer than eighty years you should foresee problems on re-sale, so it is advisable to arrange for the lease to be extended prior to buying. Ideally one should start the process of extending the lease is when a lease still has 82 years to run so that a lease extension can be concluded ahead of the 80 year threshold. Current legislation entitles Burnt Oak qualifying lessees to obtain a new lease which will be for the current unexpired lease term plus an additional term of ninety years. The purpose of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold premises in Burnt Oak with over 100 years remaining 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 home. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
Regardless of whether you are a tenant or a landlord in Burnt Oak,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Burnt Oak valuers.
In the wake of 9 months of lengthy correspondence with the freeholder of her garden flat in Burnt Oak, Rebecca commenced the lease extension process as the 80 year deadline was rapidly nearing. The legal work was finalised in October 2015. The freeholder’s fees were negotiated to slightly above 700 GBP.
Last Winter we were called by Mr and Mrs. O Martinez , who purchased a purpose-built flat in Burnt Oak in February 1999. We are asked if we could approximate the price would be for a 90 year lease extension. Comparative flats in Burnt Oak with a long lease were in the region of £275,000. The average ground rent payable was £45 billed quarterly. The lease ended in 2094. Given that there were 69 years left we calculated the premium to the freeholder to extend the lease to be within £12,400 and £14,200 exclusive of fees.
An example of a Lease Extension matter before the tribunal for a Burnt Oak residence is 20 Orchard Court Stonegrove in June 2009. The tribunal decided that a premium of £11,040 should be payable for the new lease This case affected 1 flat. The unexpired residue of the current lease was 71.55 years.