Owning a flat usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will usually be granted for a set period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Lewisham. Inevitably, the period of lease left shortens over time. This may pass by relatively unnoticed when the flat or house needs to be sold or refinanced. The shorter the lease the less it is worth and the more expensive it will be to extend the lease. Qualifying leaseholders in Lewisham have the right to extend the lease for a further ninety years in accordance with Leasehold Reform legislation. Please give due consideration before delaying your Lewisham lease extension. Holding off that expense now likely increases the price you will eventually incur to extend your lease
It is generally accepted that a residential leasehold with more than one hundred years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to any lease with more than 30 years remaining, the premises will be equivalent in value to 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| 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. |
Regardless of whether you are a tenant or a landlord in Lewisham,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Lewisham valuers.
Cameron owned a studio flat in Lewisham being sold with a lease of just over fifty eight years unexpired. Cameron informally contacted his landlord being a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent initially set at £200 per annum and increase every 25 years thereafter. No ground rent would be payable on a lease extension were Cameron to exercise his statutory right. Cameron procured expert legal guidance and secured an acceptable resolution informally and ending up with a market value flat.
Last year we were e-mailed by Mr and Mrs. L Stewart , who acquired a one bedroom flat in Lewisham in January 1996. We are asked if we could estimate the compensation to the landlord could be to extend the lease by an additional years. Similar flats in Lewisham with an extended lease were in the region of £290,000. The average amount of ground rent was £45 collected per annum. The lease lapsed on 17 March 2099. Having 73 years outstanding we calculated the premium to the landlord for the lease extension to be within £8,600 and £9,800 plus legals.
An example of a Lease Extension case for a Lewisham flat 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 number of years remaining on the existing lease(s) was 72 years.