Holland Park leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. The majority of owners of residential leasehold property in Holland Park enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Holland Park you should see if your lease has between seventy and ninety years left. There are compelling reasons why a Holland Park flat owner with a lease having around eighty years left should take steps to ensure that a lease extension is effected without delay
It is generally accepted that a property with more than 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Chelsea 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. |
| 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. |
| 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. |
Retaining our service gives you better control over the value of your Holland Park leasehold, as your property will be more valuable and marketable in terms of lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last October Noah, started to get near to the 80-year threshold with the lease on his ground floor apartment in Holland Park. In buying his flat 19 years ago, the length of the lease was of minimal importance. Thankfully, he realised he needed to take steps soon on a lease extension. Noah extended the lease at the eleventh hour in June. Noah and the landlord eventually agreed on an amount of £5,500 . If he had missed the deadline, the sum would have gone up by a minimum £1,075.
In 2012 we were called by Mr Jonathan Norbert who, having owned a studio flat in Holland Park in September 1997. The dilemma was if we could approximate the premium could be for a 90 year extension to my lease. Similar premises in Holland Park with 100 year plus lease were worth £280,000. The average ground rent payable was £45 billed monthly. The lease end date was on 17 July 2096. Having 70 years remaining we approximated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 not including expenses.
An example of a Lease Extension matter before the tribunal for a Holland Park premises is 93 Oakwood Court in June 2010. the LVT determined that the premium to be paid for the new lease was £492,083, This case related to 1 flat. The unexpired lease term was 37.79 years.