New Cross leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. The majority of owners of residential leasehold property in New Cross enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in New Cross you must see if your lease has between seventy and 90 years left. There are good reasons why a New Cross flat owner with a lease having around eighty years unexpired should take action to ensure that a lease extension is put in place without delay
It is generally considered that a property with over one hundred years unexpired lease term is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be worth the same as a freehold for decades to come.
| 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. |
| 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. |
| 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. |
| 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 New Cross can be a difficult process. We recommend you secure professional help 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 a wealth of experience procuring New Cross lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Half a year ago Nathaniel, started to get near to the 80-year threshold with the lease on his studio flat in New Cross. In buying his flat 19 years previously, the lease term was of no significance. As luck would have it, he noticed he would imminently be paying an escalated premium for Extending the lease. Nathaniel extended the lease just under the wire last June. Nathaniel and the landlord who owned the flat above eventually agreed on the final figure of £6,000 . If the lease had slipped below 80 years, the amount would have become more exhorbitant by a minimum £1,150.
In 2009 we were called by Ms P Wilson who, having moved into a first floor flat in New Cross in May 2007. We are asked if we could estimate the price would likely be for a 90 year lease extension. Comparative flats in New Cross with a long lease were valued around £280,000. The mid-range amount of ground rent was £45 collected monthly. The lease finished on 3 May 2096. Taking into account 70 years remaining we calculated the premium to the freeholder to extend the lease to be within £12,400 and £14,200 exclusive of expenses.
An example of a Freehold Enfranchisement matter before the tribunal for a New Cross premises is 41 Endwell Road in March 2013. this matter relateed to the acquisition of the freehold of a mid- terraced Victorian house converted into three separate self-contained dwellings. By an order dated 28/11/2012, Deputy District Judge Cole in the Bromley County Court held that the leaseholders were entitled to acquire the freehold and directed that the premium payable be determined by this Tribunal. The Tribunal assessed the premium to be £14,753 This case was in relation to 3 flats. The unexpired residue of the current lease was 80.01 years.