Neasden residential property owned on a long lease is a depreciating asset because a leaseholder only owns the property for a set term.
Leasehold residencies in Neasden with over 100 years remaining on the lease are sometimes referred to as ‘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 reversionary interest unless savings on ground rent and estate charges merit 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; |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 |
Lease extensions in Neasden can be a difficult process. We recommend you obtain guidance from a lawyer and valuer with experience in this area.
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 procuring Neasden lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Harry was the the leasehold proprietor of a 2 bedroom apartment in Neasden on the market with a lease of a few days over sixty years unexpired. Harry on an informal basis contacted his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. 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. Ordinarily, ground rent would not be due on a lease extension were Harry to exercise his statutory right. Harry procured expert legal guidance and secured an acceptable deal informally and sell the property.
Dr Natalie Richardson took over the lease of a newly refurbished flat in Neasden in May 2011. We are asked if we could estimate the premium would be for a 90 year extension to my lease. Comparable premises in Neasden with 100 year plus lease were worth £246,800. The average amount of ground rent was £60 invoiced quarterly. The lease concluded in 2075. Given that there were 50 years outstanding we estimated the compensation to the landlord to extend the lease to be within £44,700 and £51,600 plus fees.
An example of a Freehold Enfranchisement decision for a Neasden property 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 affected 2 flats. The number of years remaining on the existing lease(s) was 65.58 years.