Little Venice leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. It is the case that most Little Venice tenants have the right to extend their lease by an additional 90 years under the 1993 Leasehold Reform Act. If you are a leasehold owner in Little Venice you should see if your lease has between 70 and ninety years left. There are compelling reasons why a Little Venice leaseholder with a lease having around 80 years left should take action to make sure that a lease extension is effected without delay
Leasehold properties in Little Venice with more than 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value 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 maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| 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. |
Lease extensions in Little Venice can be a difficult process. We recommend you procure professional help from a conveyancer 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 a wealth of experience dealing with Little Venice lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Noah owned a high value flat in Little Venice on the market with a lease of just over 61 years unexpired. Noah informally spoke with his landlord being a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent initially set at £200 per annum and doubled every twenty five years thereafter. No ground rent would be payable on a lease extension were Noah to exercise his statutory right. Noah obtained expert legal guidance and was able to make an informed decision and deal with the matter and readily saleable.
Last month we were approach by Mr N Dupont , who acquired a purpose-built apartment in Little Venice in February 2002. We are asked if we could shed any light on how much (roughly) premium could be to prolong the lease by a further 90 years. Identical flats in Little Venice with 100 year plus lease were worth £198,800. The mid-range ground rent payable was £55 collected quarterly. The lease finished in 2081. Having 55 years remaining we approximated the premium to the freeholder for the lease extension to be between £33,300 and £38,400 exclusive of fees.
Dr Amelia Stewart moved into a one bedroom apartment in Little Venice in January 2012. The dilemma was if we could estimate the compensation to the landlord could be for a 90 year extension to my lease. Comparable homes in Little Venice with an extended lease were in the region of £300,000. The mid-range ground rent payable was £50 billed per annum. The lease expired in 2101. Considering the 75 years left we approximated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 plus legals.