For those whose North West London flat is held on a long lease, the message is clear – if no remedial action is taken, the property will ultimately revert to the freeholder, leaving you empty-handed. The fewer the years remaining the lower the value of the property and the more expensive it will be to extend the lease.
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth approximately the same as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service gives you better control over the value of your North West London leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Half a year ago Blake, started to get close to the eighty-year mark with the lease on his leasehold flat in North West London. Having bought his flat two decades ago, the unexpired term was of no significance. Luckily, he recognised he would imminently be paying an inflated amount for Extending the lease. Blake was able to extend his lease just ahead of time in July. Blake and the freeholder via the managing agents ultimately settled on a premium of £5,000 . If the lease had dipped below eighty years, the figure would have escalated by a minimum £1,100.
Dr Seth Martinez was assigned a lease of a one bedroom apartment in North West London in August 2002. We are asked if we could shed any light on how much (roughly) price could be to prolong the lease by a further 90 years. Identical flats in North West London with an extended lease were valued around £173,800. The average amount of ground rent was £60 collected monthly. The lease concluded in 2080. Taking into account 55 years as a residual term we calculated the compensation to the freeholder for the lease extension to be between £31,400 and £36,200 not including legals.
Mr and Mrs. R Ramírez purchased a studio apartment in North West London in January 2003. The dilemma was if we could approximate the price would be to extend the lease by ninety years. Similar properties in North West London with a long lease were worth £235,200. The average amount of ground rent was £45 invoiced annually. The lease terminated in 2091. Having 66 years unexpired we calculated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 not including professional charges.