Paddington leases on domestic deteriorating in value. if your lease has about ninety years unexpired, you should start thinking about a lease extension. 80 years is a significant number: when the remaining term of a lease drops below this level then you begin incurring an additional element called marriage value. Flat owners in Paddington will mostly qualify for a lease extension; however it’s a good idea to check with a conveyancing solicitor to check your eligibility. In certain situations you may not be entitled. There are also strict timetables and procedures to comply with once the process is initiated so it’s prudent to be guided by a conveyancer during the process.
It is generally considered that a residential leasehold with over 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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 |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancing solicitors that we work with handle Paddington lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancer we work with provide it.
Last year Ibrahim, came dangerously close to the 80-year threshold with the lease on his garden apartment in Paddington. Having bought his property 18 years ago, the unexpired term was of little importance. Thankfully, he noticed he would imminently be paying an escalated premium for Extending the lease. Ibrahim extended the lease just ahead of time last June. Ibrahim and the landlord who owned the flat above in the end settled on an amount of £5,500 . If the lease had dropped to less than 80 years, the amount would have become more exhorbitant by a minimum £850.
Mr Sam Green owned a garden flat in Paddington in January 2010. We are asked if we could estimate the price would be to extend the lease by ninety years. Comparable homes in Paddington with an extended lease were valued about £254,200. The average ground rent payable was £60 invoiced yearly. The lease ended on 9 October 2077. Considering the 51 years remaining we calculated the compensation to the freeholder to extend the lease to be within £43,700 and £50,600 exclusive of legals.
An example of a Lease Extension case for a Paddington property is Flats 37 & 39 88/90 Portland Place in December 2010. The Tribunal determined that the premium payable for the lease extensions in respect of these two flats is as follows:- For Flat 37, the sum of £385,230.00 For Flat 39, the sum of £436,780.00 This case affected 2 flats. The unexpired residue of the current lease was 24.02 years.