With a residential leasehold property in Croydon, you are actually buying a right to reside in a property for a prescribed time frame. These days flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you may think about a lease extension sooner as opposed to later. Accepted thinking is that the shorter the number of years is the cost of extending the lease increases markedly particularly once there are fewer than eighty years left. Anyone in Croydon with a lease nearing 81 years left should seriously consider extending it without delay. When the lease term has under eighty years left, under the current Act the landlord can calculate and demand a greater premium, based on a technical computation, strangely termed as “marriage value” which is payable.
It is conventional wisdom that a residential leasehold with over one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years remaining, 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. |
| 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; |
| 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. |
| 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:
|
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Regardless of whether you are a tenant or a freeholder in Croydon,the lease extension solicitors 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 Croydon valuers.
In the wake of eight months of lengthy negotiations with the freeholder of her one bedroom flat in Croydon, Laura started the lease extension process as the eighty year threshold was fast coming. The lease extension was concluded in October 2011. The landlord’s fees were kept to an absolute minimum.
In 2010 we were contacted by Mr and Mrs. Y Thompson who, having owned a garden apartment in Croydon in February 2009. The question was if we could shed any light on how much (roughly) premium would likely be to extend the lease by a further 90 years. Similar properties in Croydon with 100 year plus lease were in the region of £280,000. The mid-range amount of ground rent was £45 billed per annum. The lease terminated in 2095. Having 69 years outstanding we estimated the compensation to the landlord for the lease extension to be between £12,400 and £14,200 not including professional charges.
An example of a Freehold Enfranchisement matter before the tribunal for a Croydon premises is 29 Woodstock Road in April 2014. the Tribunal determined that the premiums to be paid into court in respect of the purchase of the freehold registered at HMLR under Title N0.SY3997 should be £7,217. This case related to 4 flats. The number of years remaining on the existing lease(s) was 98 years.