The re-sale value of a leasehold property in Norbiton is impacted by how long the lease has remaining. If it is near to or less than 80 years you should anticipate problems on re-sale, so it is advisable to arrange for a lease extension prior to buying. Ideally one should start the process of extending the lease is when a lease still has 82 years remaining so that a lease extension can be addressed in advance of the 80 year mark. Current legislation entitles Norbiton qualifying lessees to an additional term of 90 years on top of the unexpired term, at a peppercorn rent (no ground rent). The purpose of the valuation is to determine the premium payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold properties in Norbiton with more than one hundred years left 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 to be gained by purchasing the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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. |
| 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. |
Regardless of whether you are a tenant or a landlord in Norbiton,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Norbiton valuers.
Milo was the the leasehold owner of a 2 bedroom flat in Norbiton on the market with a lease of a little over 61 years remaining. Milo informally approached his landlord being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was keen to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent to start with set at £150 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Milo to invoke his statutory right. Milo procured expert advice and was able to make a more informed decision and handle with the matter and ending up with a market value flat.
Mr and Mrs. O Moreau completed a garden flat in Norbiton in January 1995. The question was if we could approximate the price could be for a 90 year extension to my lease. Identical homes in Norbiton with 100 year plus lease were in the region of £233,200. The mid-range amount of ground rent was £60 invoiced monthly. The lease terminated in 2087. Given that there were 61 years as a residual term we estimated the compensation to the freeholder to extend the lease to be within £22,800 and £26,400 plus professional charges.
An example of a Lease Extension case for a Norbiton residence is Flat D 15 Claremont Gardens in September 2013. TheTribunal determined in accordance with section48 and Schedule13 of the Leasehold Reform,Housing and Urban Development Act 1993 that the premium for the extended lease should be fourteen thousand one hundred and eighty seven pounds (£14,187.00) This case related to 1 flat.