Parsons Green leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Most owners of residential leasehold property in Parsons Green enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Parsons Green you should investigate if your lease has between seventy and 90 years remaining. There are compelling reasons why a Parsons Green leaseholder with a lease having around eighty years unexpired should take action to make sure that a lease extension is put in place without delay
It is conventional wisdom that a property with over one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 35 years left, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Engaging our service gives you enhanced control over the value of your Parsons Green leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Toby owned a high value apartment in Parsons Green on the market with a lease of fraction over 61 years left. Toby on an informal basis approached his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £200 yearly. Ordinarily, ground rent would not be due on a lease extension were Toby to exercise his statutory right. Toby obtained expert legal guidance and was able to make a more informed judgement and deal with the matter and sell the property.
In 2009 we were phoned by Dr G Bailey who, having took over the lease of a newly refurbished apartment in Parsons Green in May 2008. We are asked if we could approximate the price would likely be to extend the lease by 90 years. Comparative properties in Parsons Green with 100 year plus lease were in the region of £280,000. The average amount of ground rent was £55 collected monthly. The lease ended in 2102. Taking into account 77 years remaining we approximated the compensation to the freeholder to extend the lease to be between £13,300 and £15,400 not including costs.
An example of a Freehold Enfranchisement matter before the tribunal for a Parsons Green flat is 66 and 66a Wardo Avenue in November 2012. The Tribunal determined that the sum of £8,048 is payable by the Applicants in respect of the price for the freehold of the property This case affected 2 flats. The unexpired lease term was 93 years and 162 years.