It’s a harsh certainty that a Lewisham residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Lewisham property prices.Where your lease has approximately ninety years left, you should start considering a lease extension. If the number of years remaining drops under 80 years, you will then be required to pay 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 additional value that a lease extension will add the property Most flat owners in Lewisham will be able to extend under the legislation; however a lawyer should be able to clarify if you are eligibility. In some cases you may not be entitled. There are also strict timeframes and procedures to be adhered to once the process is initiated and you will need to be guided by your lawyer from beginning to end of the formalities.
Leasehold premises in Lewisham with over 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and service charges warrant it.
| 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | 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. |
Lease extensions in Lewisham can be a difficult process. We recommend you get guidance from a lawyer and surveyor well versed in the legislation and lease extension process.
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 Lewisham lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In 2014 Harry, came critically near to the eighty-year threshold with the lease on his leasehold flat in Lewisham. In buying his flat two decades ago, the lease term was of little bearing. Luckily, he became aware that he needed to take steps soon on a lease extension. Harry was able to extend his lease just under the wire last July. Harry and the freeholder in the end settled on the final figure of £5,000 . If he not met the deadline, the premium would have increased by at least £975.
In 2012 we were approached by Mrs Jessica Dupont who, having took over the lease of a ground floor flat in Lewisham in September 2004. The question was if we could estimate the compensation to the landlord could be for a ninety year lease extension. Comparative residencies in Lewisham with an extended lease were valued around £181,600. The mid-range amount of ground rent was £55 billed monthly. The lease ended on 27 January 2078. Given that there were 52 years unexpired we calculated the premium to the landlord to extend the lease to be within £30,400 and £35,200 not including fees.
An example of a Lease Extension decision for a Lewisham property is 73 Walerand Road in August 2012. the result of the findings of the Tribunal led to a premium to be paid for the extended lease in respect of Flat 73 in the sum of £10,040. The premium applicable in respect of Flat 85 was £5,710. This case was in relation to 2 flats. The unexpired term as at the valuation date was 72 years.