It’s an underpublicised truth that a Gunnersbury residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Gunnersbury property market.Once your lease nears 85ish years, you need to 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 dips lower than eighty years - otherwise a higher premium will be due. The majority of flat owners in Gunnersbury will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm whether you qualify for an extension. In some situations you may not qualify. 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 throughout the formalities.
Leasehold residencies in Gunnersbury with over 100 years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| Yorkshire Building Society | 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. |
Engaging our service will provide you better control over the value of your Gunnersbury leasehold, as your property will be more valuable and saleable in respect of lease length should you wish to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Last year Sebastian, started to get near to the eighty-year threshold with the lease on his purpose- built apartment in Gunnersbury. In buying his flat 18 years previously, the lease term was of minimal concern. Luckily, he realised he would soon be paying an inflated amount for Extending the lease. Sebastian extended the lease just under the wire last July. Sebastian and the landlord in the end settled on sum of £6,000 . If he failed to meet the deadline, the premium would have escalated by a minimum £900.
Last month we were contacted by Mrs Y Lefèvre , who purchased a studio apartment in Gunnersbury in April 2003. We are asked if we could approximate the price would be for a ninety year extension to my lease. Comparable homes in Gunnersbury with 100 year plus lease were valued about £255,000. The mid-range amount of ground rent was £50 collected annually. The lease ran out in 2095. Given that there were 70 years as a residual term we calculated the compensation to the freeholder for the lease extension to be within £10,500 and £12,000 exclusive of fees.
An example of a Freehold Enfranchisement decision for a Gunnersbury property is 169 Southfield Road in September 2013. the tribunal decided that the premium to be paid in respect of the collective enfranchisement should be £51,203 This case related to 2 flats. The unexpired residue of the current lease was 64.64 years.