The market value of a leasehold property in Finchley is impacted by how long the lease has remaining. If it is near to or less than 80 years you should anticipate difficulties on re-sale, so it is advisable to arrange for a lease extension prior to purchasing. It is ideal to start the process of extending the lease is when the lease still has 82 years unexpired so that a lease extension can be concluded ahead of the 80 year cut off point. Current legislation enables Finchley qualifying lessees to obtain a new lease which will be for the balance of the existing lease plus a supplemental term of 90 years. The intention of the valuation is to arrive at an opinion of the sum payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold properties in Finchley with over 100 years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and estate charges merit 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
Engaging our service will provide you enhanced control over the value of your Finchley leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last Autumn Teddy, started to get near to the 80-year threshold with the lease on his studio apartment in Finchley. Having purchased his property two decades ago, the lease term was of no interest. As luck would have it, he noticed he would imminently be paying an inflated amount for Extending the lease. Teddy extended the lease at the eleventh hour in May. Teddy and the landlord in the end agreed on the final figure of £6,000 . If he not met the deadline, the figure would have escalated by a minimum £1,150.
Mr and Mrs. G Lefèvre moved into a basement apartment in Finchley in June 1995. We are asked if we could approximate the compensation to the landlord would likely be to extend the lease by 90 years. Comparative properties in Finchley with an extended lease were valued around £171,800. The mid-range ground rent payable was £55 collected every twelve months. The lease finished on 11 May 2076. Considering the 50 years left we approximated the premium to the freeholder to extend the lease to be between £33,300 and £38,400 not including legals.
An example of a Lease Extension decision for a Finchley flat is Ground Floor 110 Station Road in June 2013. The Tribunal found that the premium payable for a lease extension should be £31,665. This case related to 1 flat. The number of years remaining on the existing lease(s) was 56.65 years.