Owning a apartment usually means owning a lease of the property, which has a finite term of years. This lease will usually be granted for a fixed period of time , usually 99 or 125 years, although we have seen longer and shorter terms in North West London. Clearly, the term of lease left shortens over time. This is often overlooked and only raises itself as an issue when the residence needs to be disposed of or re-mortgaged. The shorter the lease the lower the value of the property and the more it will cost to extend the lease. Eligible leaseholders in North West London have the right to extend the lease for an additional ninety years in accordance with Leasehold Reform legislation. You should give due deliberation before putting off your North West London lease extension. Putting off that expense now likely increases the price you will ultimately incur to extend your lease
It is generally accepted that a residential leasehold with more than one hundred years remaining is worth approximately the same as a freehold. Where an further 90 years added to any lease with more than 30 years remaining, the property will be worth the same as a freehold for decades to come.
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Yorkshire 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. |
Regardless of whether you are a tenant or a freeholder in North West London,the lease extension experts that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with North West London valuers.
Harvey owned a high value flat in North West London on the market with a lease of fraction over sixty years left. Harvey informally approached his landlord a well known London-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 on the basis of a new rent initially set at £100 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Harvey to invoke his statutory right. Harvey procured expert advice and secured satisfactory resolution informally and sell the flat.
Last Autumn we were phoned by Dr Ethan Leroy , who completed a first floor apartment in North West London in June 2003. The dilemma was if we could approximate the premium would likely be for a ninety year lease extension. Similar residencies in North West London with an extended lease were valued about £261,600. The mid-range ground rent payable was £60 collected quarterly. The lease terminated on 4 April 2077. Taking into account 52 years left we approximated the premium to the landlord for the lease extension to be within £39,000 and £45,000 exclusive of professional charges.
Last month we were e-mailed by Mr Dexter Robinson , who acquired a first floor apartment in North West London in September 2004. The dilemma was if we could shed any light on how much (approximately) premium could be for a ninety year extension to my lease. Comparative premises in North West London with 100 year plus lease were worth £218,000. The average ground rent payable was £45 collected every twelve months. The lease expired on 4 April 2088. Given that there were 63 years left we calculated the premium to the freeholder for the lease extension to be between £17,100 and £19,800 not including professional charges.