The market value of a leasehold property in Romford depends on how many years the lease has remaining. If it is near to or fewer than eighty years you should envisage difficulties on re-sale, so it is advisable to arrange for a lease extension before purchasing. It is preferable to start the lease extension process when the lease still has 82 years remaining so that formalities can be finalised in advance of the 80 year mark. Leasehold Reform legislation entitles Romford qualifying lessees to obtain a new lease which will be for the balance of the existing lease plus an additional term of 90 years. The intention of the valuation is to determine the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold properties in Romford with in excess of one hundred years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the freehold 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; |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 Romford can be a difficult process. We recommend you procure professional help 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 procuring Romford lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Kai was the the leasehold owner of a studio flat in Romford on the market with a lease of a little over fifty eight years outstanding. Kai on an informal basis contacted his freeholder a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to a new rent to start with set at £150 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Kai to invoke his statutory right. Kai procured expert advice and was able to make an informed decision and handle with the matter and readily saleable.
Mrs N Howard bought a newly refurbished flat in Romford in October 2007. The question was if we could approximate the premium would likely be to prolong the lease by ninety years. Comparative properties in Romford with 100 year plus lease were in the region of £198,800. The average ground rent payable was £55 collected annually. The lease elapsed in 2081. Given that there were 55 years left we estimated the premium to the freeholder to extend the lease to be within £33,300 and £38,400 exclusive of fees.
An example of a Lease Extension decision for a Romford flat is 37 Lodge Court High Street in November 2013. the decision of the LVT was that the premium to be paid for the new lease was £25,559 This case affected 1 flat. The unexpired term was 57.5 years.