With a residential leasehold premises in Neasden, you effectively rent it for a certain period of time. In recent years flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you should consider a lease extension sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly especially when there are fewer than 80 years left. Leasehold owners in Neasden with a lease approaching 81 years left should seriously think of extending it as soon as possible. When a lease has less than 80 years remaining, under the current Act the freeholder can calculate and charge a greater amount, assessed on a technical multiplication, known as “marriage value” which is due.
Leasehold residencies in Neasden 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 premises. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with handle Neasden lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Last October Muhammad, came critically near to the 80-year mark with the lease on his two bedroom flat in Neasden. Having bought his home two decades ago, the unexpired term was of minimal significance. Luckily, it dawned on him that he needed to take action soon on a lease extension. Muhammad extended the lease just in the nick of time last April. Muhammad and the landlord who owned the flat above eventually agreed on the final figure of £5,500 . If the lease had gone lower than 80 years, the price would have become more exhorbitant by a minimum £925.
Last month we were e-mailed by Dr Owen Rodríguez , who bought a purpose-built apartment in Neasden in March 1998. The question was if we could estimate the price would be to prolong the lease by 90 years. Comparative properties in Neasden with an extended lease were in the region of £203,200. The average amount of ground rent was £65 billed quarterly. The lease termination date was on 3 November 2087. Taking into account 61 years unexpired we estimated the premium to the landlord for the lease extension to be between £19,000 and £22,000 plus legals.
An example of a Freehold Enfranchisement case for a Neasden premises is 12 & 12A Deacon Road in May 2010. the Tribunal concluded that the price to be paid for the freehold should be £38,287 This case was in relation to 2 flats. The unexpired lease term was 65.58 years.