It’s a harsh certainty that a Fulham residential lease is a wasting asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the deflation being disguised by increases in the Fulham property market.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. If the number of years remaining falls below eighty years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property The majority of flat owners in Fulham will be able to extend under the legislation; however a conveyancer will be able to clarify if you qualify for an extension. In some cases you may not be entitled. There are also strict timetables and procedures to be adhered to once the process is initiated and you will need to be guided by your conveyancer for the duration of the formalities.
Leasehold premises in Fulham with in excess of one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in buying the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date 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. |
Irrespective of whether you are a tenant or a landlord in Fulham,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Fulham valuers.
Finley was the the leasehold proprietor of a conversion flat in Fulham being sold with a lease of just over 72 years left. Finley on an informal basis approached his landlord a well known Manchester-based freehold company for a lease extension. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to an increased rent to £50 annually. Ordinarily, ground rent would not be payable on a lease extension were Finley to invoke his statutory right. Finley procured expert advice and secured satisfactory resolution without going to tribunal and sell the property.
Last Spring we were contacted by Dr Chelsea Richardson , who moved into a recently refurbished flat in Fulham in February 2009. We are asked if we could shed any light on how much (approximately) price could be to prolong the lease by ninety years. Identical homes in Fulham with a long lease were valued about £265,000. The mid-range ground rent payable was £50 invoiced yearly. The lease ran out in 2098. Taking into account 73 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 not including fees.
An example of a Freehold Enfranchisement matter before the tribunal for a Fulham residence is 66 and 66a Wardo Avenue in November 2012. The Tribunal determined that the sum of £8,048 is payable by the Applicants in respect of the price for the freehold of the property This case related to 2 flats. The unexpired term as at the valuation date was 93 years and 162 years.