North Kensington residential property owned on a long lease is a wasting asset because a leaseholder only owns the property for a period of years.
It is conventional wisdom that a residential leasehold with more than one hundred years remaining is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| 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 are not acceptable. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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 North Kensington can be a difficult process. We recommend you obtain guidance from a lawyer and surveyor 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 North Kensington lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Caleb was the the leasehold owner of a conversion flat in North Kensington on the market with a lease of fraction over 61 years outstanding. Caleb on an informal basis spoke with his landlord being a well known Manchester-based freehold company for a lease extension. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £125 yearly. Ordinarily, ground rent would not be payable on a lease extension were Caleb to invoke his statutory right. Caleb obtained expert legal guidance and secured an acceptable deal without resorting to tribunal and readily saleable.
Dr V Bennett took over the lease of a garden flat in North Kensington in January 1999. The question was if we could shed any light on how much (approximately) price would be to extend the lease by an additional years. Comparative homes in North Kensington with an extended lease were worth £225,800. The mid-range ground rent payable was £60 invoiced yearly. The lease ended on 14 April 2086. Having 60 years outstanding we estimated the compensation to the freeholder for the lease extension to be between £23,800 and £27,400 not including fees.
An example of a Lease Extension decision for a North Kensington residence is 93 Oakwood Court in June 2010. the LVT determined that the premium to be paid for the new lease was £492,083, This case related to 1 flat. The unexpired term as at the valuation date was 37.79 years.