Covent Garden leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. The majority of owners of residential leasehold property in Covent Garden enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Covent Garden you must check if your lease has between 70 and ninety years remaining. There are compelling reasons why a Covent Garden flat owner with a lease having around 80 years remaining should take action to make sure that a lease extension is actioned without delay
It is conventional wisdom that a property with in excess of one hundred years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 30 years unexpired, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Covent Garden can be a difficult process. We recommend you obtain professional help from a conveyancer and valuer well versed in the legislation and lease extension process.
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 Covent Garden lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In 2014 Alexander, came seriously close to the 80-year threshold with the lease on his leasehold flat in Covent Garden. Having purchased his property 19 years previously, the unexpired term was of no relevance. by good luck, he recognised he would soon be paying an inflated amount for Extending the lease. Alexander arranged for a lease extension at the eleventh hour in June. Alexander and the freeholder eventually agreed on a premium of £5,500 . If he not met the deadline, the figure would have gone up by a minimum £925.
Ms T Campbell moved into a studio flat in Covent Garden in June 2000. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be for a ninety year lease extension. Comparable residencies in Covent Garden with 100 year plus lease were in the region of £232,800. The mid-range ground rent payable was £45 collected monthly. The lease expired in 2091. Considering the 65 years unexpired we approximated the premium to the freeholder for the lease extension to be within £13,300 and £15,400 not including legals.
An example of a Freehold Enfranchisement matter before the tribunal for a Covent Garden 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 was in relation to 1 flat. The unexpired term as at the valuation date was 73.26 years.