Putney 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. Legislation has been in place for sometime now allowing qualifying Putney residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Putney you would be well advised to investigate if your lease has between seventy and 90 years left. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension sharply increases as part of the premium you will incur is what is known as a marriage value
Leasehold residencies in Putney with more than one hundred years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Birmingham Midshires | 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 |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Putney can be a difficult process. We recommend you procure guidance from a lawyer and surveyor with experience in lease extensions.
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 a wealth of experience dealing with Putney lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last October Eliot, came perilously near to the eighty-year mark with the lease on his purpose- built apartment in Putney. In buying his property 18 years ago, the length of the lease was of minimal concern. Thankfully, it dawned on him that he needed to take steps soon on Extending the lease. Eliot was able to extend his lease just ahead of time last July. Eliot and the landlord who owned the flat above in the end agreed on an amount of £6,000 . If he failed to meet the deadline, the sum would have become more costly by at least £850.
Dr C Moore was assigned a lease of a one bedroom flat in Putney in April 2003. The dilemma was if we could estimate the price could be for a ninety year extension to my lease. Comparable flats in Putney with a long lease were in the region of £171,800. The mid-range amount of ground rent was £55 billed per annum. The lease elapsed on 6 January 2075. Taking into account 50 years left we estimated the compensation to the freeholder to extend the lease to be within £33,300 and £38,400 not including fees.
An example of a Freehold Enfranchisement case for a Putney property is 19 St. Margarets Crescent in August 2010. the tribunal was of the view that the premium to be paid by the leaseholder for the freehold reversion was £51,983.00 This case was in relation to 3 flats. The unexpired term as at the valuation date was 66.25 years.