Colindale leases on domestic properties are gradually losing value. if your lease has in the region of 90 years unexpired, you should start considering the need for a lease extension. If lease term falls under 80 years, you will then have to pay 50% of the property's 'marriage value' on top of the usual cost of the lease extension to your landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Flat owners in Colindale will usually qualify for a lease extension; however it’s a good idea to check with a lawyer to check if you qualify. In certain cases you may not be entitled. There are prescribed deadlines and steps to follow once the process is initiated so it’s prudent to be guided by a lawyer during the process.
It is conventional wisdom that a residential leasehold with in excess of one hundred years remaining is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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. |
| 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. |
| 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. |
Retaining our service gives you increased control over the value of your Colindale leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Trailing unsuccessful correspondence with the freeholder of her first floor flat in Colindale, Sophie initiated the lease extension process just as the lease was nearing the all-important 80-year deadline. The transaction completed in January 2006. The freeholder’s fees were kept to an absolute minimum.
Dr Eli Peterson moved into a studio flat in Colindale in February 2003. We are asked if we could estimate the premium would likely be to prolong the lease by ninety years. Similar residencies in Colindale with a long lease were in the region of £176,200. The mid-range ground rent payable was £65 collected annually. The lease terminated in 2082. Taking into account 56 years as a residual term we calculated the compensation to the landlord for the lease extension to be within £29,500 and £34,000 not including professional charges.
An example of a Lease Extension case for a Colindale residence is 27B Hillside in February 2010. the resulting premium, all other aspects of the valuation having been agreed between the parties was set at £8,250 This case related to 1 flat. The unexpired residue of the current lease was 70.25 years.