Kew leases on domestic properties are gradually losing value. Where your lease has in the region of 90 years left, you should start considering the need for a lease extension. An important point to note is that it is desirable for a lease extension to be in place before the term of the current lease falls lower than eighty years - otherwise a higher premium will be payable. Flat owners in Kew will usually qualify for a lease extension; however a solicitor will check your eligibility. In some situations you may not qualify. There are also strict deadlines and steps to follow once the process is triggered so it’s prudent to be guided by a lawyer during the process.
Leasehold residencies in Kew with over one hundred years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth 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 estate charges merit 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
| 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 increased control over the value of your Kew leasehold, as your property will be more valuable and marketable in relation to the lease length should you want 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.
Finn was the the leasehold owner of a 2 bedroom flat in Kew being marketed with a lease of a few days over fifty eight years left. Finn on an informal basis spoke with his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years on the basis of an increased rent to £125 yearly. Ordinarily, ground rent would not be payable on a lease extension were Finn to invoke his statutory right. Finn obtained expert advice and secured an acceptable resolution without going to tribunal and sell the property.
Last Summer we were called by Mrs Lydia Moore , who bought a ground floor flat in Kew in June 2001. The dilemma was if we could approximate the premium could be to extend the lease by a further 90 years. Comparable residencies in Kew with an extended lease were worth £280,000. The average ground rent payable was £45 billed annually. The lease came to a finish in 2095. Considering the 70 years left we approximated the premium to the landlord to extend the lease to be between £12,400 and £14,200 not including costs.
An example of a Lease Extension case for a Kew residence is Flat 1 30 Ennismore Avenue in September 2010. the Tribunal adopted and arrived at a premium for the lease extension of £29, 900 This case related to 1 flat. The number of years remaining on the existing lease(s) was 68.34 years.