The market value of Marylebone leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can escalate substantially once the unexpired lease term is less than eighty years
Leasehold premises in Marylebone with in excess of one hundred years outstanding 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 circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges warrant 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Marylebone can be a difficult process. We recommend you get guidance from a conveyancing solicitor and valuer 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 Marylebone lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Adam owned a conversion flat in Marylebone being sold with a lease of just over 59 years left. Adam on an informal basis contacted his freeholder being a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to extend 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 Adam to invoke his statutory right. Adam obtained expert advice and was able to make a more informed judgement and deal with the matter and ending up with a market value flat.
In 2009 we were approached by Mr Ethan Rose who, having bought a one bedroom apartment in Marylebone in January 2007. The dilemma was if we could approximate the premium could be to prolong the lease by an additional years. Similar premises in Marylebone with a long lease were worth £267,600. The average amount of ground rent was £65 invoiced quarterly. The lease terminated on 1 April 2092. Taking into account 67 years as a residual term we estimated the premium to the landlord to extend the lease to be between £14,300 and £16,400 exclusive of fees.
An example of a Lease Extension matter before the tribunal for a Marylebone flat is Flats 37 & 39 88/90 Portland Place in December 2010. The Tribunal determined that the premium payable for the lease extensions in respect of these two flats is as follows:- For Flat 37, the sum of £385,230.00 For Flat 39, the sum of £436,780.00 This case was in relation to 2 flats. The remaining number of years on the lease was 24.02 years.