Unfortunately that a Charing Cross 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 depreciation being disguised by increases in the Charing Cross property prices.Once your lease gets to 85ish years, you should start considering a lease extension. If lease term dips under 80 years, you will end up paying 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Charing Cross will be able to extend under the legislation; however a conveyancer will be able to clarify whether you are eligibility. In some cases you may not qualify. There are also strict deadlines and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancer throughout the process.
Leasehold residencies in Charing Cross with over one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Santander | If the property is leasehold, the remaining unexpired lease term at the end of the new mortgage term must be at least 50 years where any part of the mortgage is on Interest Only and 30 years if all loan parts are on Capital Repayment and Interest. You must report the unexpired lease term to us and await our instructions if:
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Irrespective of whether you are a tenant or a freeholder in Charing Cross,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Charing Cross valuers.
Finley was the the leasehold proprietor of a high value flat in Charing Cross being sold with a lease of a little over sixty years unexpired. Finley informally spoke with his freeholder a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £150 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Finley to invoke his statutory right. Finley obtained expert advice and was able to make a more informed decision and deal with the matter and sell the property.
Last Spring we were contacted by Mr and Mrs. F Lee , who acquired a one bedroom apartment in Charing Cross in July 2008. The question was if we could shed any light on how much (roughly) compensation to the landlord would likely be to extend the lease by 90 years. Comparable premises in Charing Cross with a long lease were worth £174,200. The average ground rent payable was £55 collected monthly. The lease ended on 18 June 2077. Having 51 years unexpired we calculated the compensation to the landlord to extend the lease to be within £31,400 and £36,200 plus legals.
An example of a Freehold Enfranchisement matter before the tribunal for a Charing Cross flat is 20 Avonwick Road in July 2013. The Tribunal was dealing with an application under Section 26 of the Leasehold Reform Housing and Urban Development Act 1993 for a determination of the freehold value of the property. It was concluded that the price to be paid was Fifteen Thousand Nine Hundred and Seventy (£15,970) divided as to £8,200 for Flat 20 and £7,770 for Flat 20A This case related to 1 flat. The number of years remaining on the existing lease(s) was 73.26 years.