Unfortunately that a Eastcote residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the early years due to the depreciation being disguised by increases in the Eastcote property prices.Where your lease has approximately ninety years left, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips below eighty years - otherwise a higher amount will be due. Most flat owners in Eastcote will be able to extend under the legislation; however a lawyer will be able to confirm if you qualify for an extension. In some situations you may not qualify. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your lawyer from beginning to end of the formalities.
Leasehold residencies in Eastcote with more than one hundred years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and service charges warrant it.
| 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. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with handle Eastcote lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancer we work with provide it.
Last year Alfie, started to get near to the 80-year threshold with the lease on his basement flat in Eastcote. Having purchased his property two decades ago, the length of the lease was of no concern. Luckily, he noticed he would imminently be paying an inflated amount for a lease extension. Alfie was able to extend his lease at the eleventh hour last May. Alfie and the landlord who owned the flat above ultimately settled on a premium of £5,000 . If the lease had gone to less than eighty years, the sum would have become more exhorbitant by a minimum £1,050.
In 2011 we were phoned by Mr and Mrs. M Rose who, having took over the lease of a garden apartment in Eastcote in April 1996. We are asked if we could estimate the price would be for a ninety year lease extension. Comparable flats in Eastcote with a long lease were in the region of £285,000. The average amount of ground rent was £55 invoiced annually. The lease ran out in 2105. Given that there were 79 years outstanding we estimated the premium to the landlord to extend the lease to be between £13,300 and £15,400 plus costs.
An example of a Lease Extension decision for a Eastcote property is Flat 72 Queens Walk in January 2013. The Tribunals calculated the premium payable to be £22,090. This case related to 1 flat. The unexpired term as at the valuation date was 53.26 years.