Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will normally be granted for a fixed period of time , usually 99 or 125 years, although we have come across longer and shorter terms in Croxley Green. Clearly, the term of lease remaining shortens as time goes by. This may slip by relatively unnoticed when the property has to be sold or refinanced. The fewer the years remaining the less it is worth and the more expensive it will be to obtain a lease extension. Eligible leaseholders in Croxley Green have the legal entitlement to extend the lease for an additional 90 years under statute. Do give careful consideration before putting off your Croxley Green lease extension. Putting off the cost now likely increases the price you will eventually incur for a lease extension
It is conventional wisdom that a residential leasehold with in excess of 100 years unexpired lease term is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 45 years left, the residence will be equivalent in value to a freehold for many years in the future.
| 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Irrespective of whether you are a tenant or a landlord in Croxley Green,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Croxley Green valuers.
In recent months Elijah, started to get near to the 80-year threshold with the lease on his leasehold flat in Croxley Green. In buying his flat twenty years previously, the unexpired term was of little importance. Thankfully, he recognised he needed to take action soon on a lease extension. Elijah was able to extend his lease just under the wire last April. Elijah and the freeholder in the end agreed on sum of £5,000 . If he failed to meet the deadline, the premium would have become more exhorbitant by at least £1,100.
Last month we were phoned by Mr and Mrs. A Garcia , who purchased a studio flat in Croxley Green in October 2010. The dilemma was if we could estimate the premium would be to extend the lease by 90 years. Identical properties in Croxley Green with a long lease were worth £198,800. The average amount of ground rent was £55 billed annually. The lease terminated on 25 February 2081. Taking into account 55 years outstanding we approximated the compensation to the landlord to extend the lease to be between £33,300 and £38,400 exclusive of fees.
An example of a Lease Extension case for a Croxley Green premises is Flats 8, 11 and 15 Craigmore Court 46 Murray Road in December 2013. The tribunal held that the price payable by the Applicant tenant of Flat 8 to acquire an extended lease shall be £26,438 plus £1 to the intermediate lessee . The tribunal held that the price payable by the Applicant tenants of Flat 11 to acquire an extended lease shall be £26,791 plus £1 to the intermediate lessee. The tribunal held that the price payable by the Applicant tenant of Flat 15 to acquire an extended lease shall be £26,638 plus £1 to the intermediate lessee . This case related to 3 flats. The unexpired term was 71 years.