Petersham leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease gets more expensive. Legislation has been in place for sometime now which entitles qualifying Petersham residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Petersham you really ought to investigate if your lease has between seventy and ninety years remaining. There are compelling reasons why a Petersham leaseholder with a lease having around 80 years remaining should take action to make sure that a lease extension is put in place without delay
Leasehold premises in Petersham with over one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such circumstances there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | 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. |
| 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. |
Lease extensions in Petersham can be a difficult process. We recommend you procure guidance from a conveyancing solicitor and valuer well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge dealing with Petersham lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
14 months ago Charlie, started to get near to the 80-year mark with the lease on his first floor flat in Petersham. Having purchased his home 18 years ago, the length of the lease was of little relevance. by good luck, it dawned on him that he needed to take action soon on Extending the lease. Charlie extended the lease at the eleventh hour in May. Charlie and the landlord who owned the flat above eventually agreed on a premium of £5,000 . If the lease had gone below 80 years, the premium would have become more exhorbitant by a minimum £975.
Mr and Mrs. L Morel bought a ground floor flat in Petersham in May 2011. The dilemma was if we could approximate the price could be to extend the lease by ninety years. Comparable homes in Petersham with an extended lease were valued about £205,000. The mid-range ground rent payable was £50 collected quarterly. The lease ran out in 2105. Given that there were 79 years outstanding we estimated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 plus costs.
An example of a Lease Extension matter before the tribunal for a Petersham premises is Ground Floor Flat 91 Bath Road in May 2009. in a case where the freeholder could not be traced, the Brentford County Court ordered that the Lease be surrendered in return for the grant of a new lease of the Premises at a premium determined by the Leasehold Valuation Tribunal. The tribunal concluded that the price payable by the Applicant for the new lease of the premises be £15,900 This case related to 1 flat. The number of years remaining on the existing lease(s) was 60.45 years.