For anyone whose Kings Heath property is held on a long lease, our message is clear – if you do nothing, your property will eventually revert to your landlord, leaving you empty-handed. The shorter the lease the less it is worth and the more expensive it will be to extend the lease.
It is generally considered that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| Halifax | Minimum 70 years from the date 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. |
Lease extensions in Kings Heath can be a difficult process. We recommend you obtain professional help from a conveyancer and valuer with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Kings Heath lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last Winter Jude, started to get close to the 80-year mark with the lease on his one bedroom apartment in Kings Heath. In buying his home twenty years ago, the unexpired term was of minimal interest. by good luck, he recognised he needed to take action soon on a lease extension. Jude arranged for a lease extension just ahead of time last May. Jude and the landlord who owned the flat above ultimately settled on a premium of £5,500 . If the lease had descended to less than 80 years, the premium would have increased by at least £1,000.
In 2011 we were called by Mr and Mrs. G Brown who, having was assigned a lease of a basement apartment in Kings Heath in October 2009. We are asked if we could shed any light on how much (roughly) compensation to the landlord would likely be to extend the lease by a further 90 years. Similar properties in Kings Heath with a long lease were in the region of £201,200. The average ground rent payable was £55 collected every twelve months. The lease terminated on 11 August 2082. Given that there were 56 years left we approximated the premium to the landlord to extend the lease to be between £31,400 and £36,200 exclusive of costs.
Last Summer we were phoned by Mrs H Williams , who purchased a one bedroom flat in Kings Heath in May 2008. We are asked if we could shed any light on how much (roughly) premium would be for a 90 year lease extension. Comparable flats in Kings Heath with an extended lease were valued around £300,000. The mid-range ground rent payable was £50 invoiced yearly. The lease termination date was on 23 March 2102. Having 76 years as a residual term we approximated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 plus legals.