The re-sale value of a leasehold property in Oval depends on how long the lease has left to run. If it is near to or less than eighty years you should envisage difficulties on re-sale, so it is advisable to arrange for the lease to be extended prior to purchasing. It is ideal to start the lease extension process when the lease still has 82 years unexpired so that formalities can be finalised prior to the eighty year mark. Current legislation entitles Oval qualifying lessees to a ninety year extension added to their remaining lease term (ie if your lease has 50 years remaining the statutory lease extension will provide a new term of 140 years). The reason of the valuation is to determine the premium payable by the lessee to the freeholder for the purchase of the lease extension.
It is generally accepted that a property with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 35 years remaining, the property will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Irrespective of whether you are a tenant or a freeholder in Oval,the lease extension lawyers 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 Oval valuers.
Nathaniel owned a high value flat in Oval being sold with a lease of just over fifty eight years unexpired. Nathaniel informally contacted his landlord being a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £200 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Nathaniel to invoke his statutory right. Nathaniel obtained expert advice and secured satisfactory deal without going to tribunal and sell the property.
In 2014 we were e-mailed by Dr Caitlin Martin who, having was assigned a lease of a basement flat in Oval in November 2010. We are asked if we could shed any light on how much (approximately) price would likely be to extend the lease by ninety years. Identical flats in Oval with a long lease were valued around £290,000. The average amount of ground rent was £45 invoiced yearly. The lease expiry date was in 2098. Having 73 years left we calculated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 not including legals.
An example of a Lease Extension matter before the tribunal for a Oval residence is Ground Floor Flat 39 Bronsart Road in May 2010. Following a vesting order by West London County Court the Leasehold Valuation Tribunal concluded that the price to be paid for the extended lease of the premises was Thirteen Thousand Two hundred pounds (£13,200) in accordance with the valuation. The extended lease was granted for a term of 90 years from the expiry date of the Lease and at a peppercorn ground rent from the date of the vesting order. This case was in relation to 1 flat. The number of years remaining on the existing lease(s) was 74.77 years.