The re-sale value of a leasehold property in Canonbury depends on how long the lease has remaining. If it is close to or fewer than eighty years you should foresee 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 lease extension process when a lease still has 82 years to run so that all matters can be addressed ahead of the eighty year mark. Leasehold Reform legislation enables Canonbury qualifying lessees to an additional term of 90 years over and above the existing term, at a notional rent (no ground rent). The intention of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold residencies in Canonbury with in excess of 100 years outstanding 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 situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and service charges justify 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; |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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 Canonbury can be a difficult process. We recommend you obtain professional help 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 in-depth market knowledge procuring Canonbury lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Jamie was the the leasehold owner of a studio flat in Canonbury being marketed with a lease of a few days over 61 years remaining. Jamie on an informal basis approached his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent at the outset set at £100 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Jamie to invoke his statutory right. Jamie obtained expert legal guidance and secured an acceptable resolution without resorting to tribunal and ending up with a market value flat.
In 2011 we were phoned by Mr and Mrs. L Lefèvre who, having completed a purpose-built apartment in Canonbury in August 2007. We are asked if we could estimate the compensation to the landlord could be for a 90 year extension to my lease. Comparative properties in Canonbury with 100 year plus lease were valued around £184,000. The mid-range amount of ground rent was £55 billed annually. The lease ran out on 19 October 2079. Given that there were 53 years outstanding we estimated the compensation to the freeholder to extend the lease to be within £28,500 and £33,000 plus fees.
An example of a Lease Extension decision for a Canonbury residence is 5C Stoke Newington Road in April 2010. the Tribunal therefore concludes that the premium to be paid for the extended lease is £700.00 This case related to 1 flat. The unexpired residue of the current lease was 80.5 years.