Motspur Park 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 your lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Motspur Park residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Motspur Park you should see if your lease has between seventy and 90 years left. In particular once the remaining lease term slips under eighty years, the compensation to the landlord for any lease extension sharply increases as part of the premium you will incur is what is known as a marriage value
Leasehold premises in Motspur Park with in excess of one hundred years unexpired on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| 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 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; |
| Chelsea 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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 Motspur Park,the lease extension experts 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 Motspur Park valuers.
Following protracted negotiations with the landlord of her first floor apartment in Motspur Park, Francesca commenced the lease extension process as the eighty year deadline was quickly advancing. The transaction was concluded in April 2009. The landlord’s fees were kept to an absolute minimum.
In 2014 we were approached by Dr U Bailey who, having completed a one bedroom apartment in Motspur Park in July 1997. The question was if we could approximate the premium could be to prolong the lease by a further 90 years. Comparable properties in Motspur Park with an extended lease were in the region of £223,400. The average amount of ground rent was £60 billed every twelve months. The lease terminated in 2083. Considering the 59 years unexpired we calculated the premium to the landlord for the lease extension to be between £27,600 and £31,800 not including professional charges.
An example of a Lease Extension matter before the tribunal for a Motspur Park property is 33 The Maisonettes Alberta Avenue in June 2014. the Tribunal decided that the premium payable for the grant of a new lease be the sum of £20,680 (Twenty Thousand six hundred and eighty pounds). This case related to 1 flat. The number of years remaining on the existing lease(s) was 60.43 years.