With a residential leasehold property in Shepherd's Bush, you are actually buying a right to live in a property for a set period of time. Modern flat leases typically tend to be for 99 years or 125. Even though this may appear like a long period of time, you should consider extending the lease sooner rather than later. The general rule is that the shorter the number of years is the cost of extending the lease becomes disproportionately greater particularly once there are fewer than eighty years remaining. Residents in Shepherd's Bush with a lease approaching 81 years left should seriously think of extending it sooner than later. When a lease has less than 80 years remaining, under the relevant statute the freeholder is entitled to calculate and demand a larger premium, assessed on a technical multiplication, strangely termed as “marriage value” which is payable.
It is conventional wisdom that a property with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
Lease extensions in Shepherd's Bush can be a difficult process. We recommend you procure guidance from a conveyancer and surveyor with experience in this area.
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 Shepherd's Bush lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In recent months Lewis, came critically close to the eighty-year threshold with the lease on his first floor flat in Shepherd's Bush. Having bought his property two decades ago, the length of the lease was of little importance. Fortunately, it dawned on him that he would imminently be paying an escalated premium for Extending the lease. Lewis was able to extend his lease just in the nick of time last May. Lewis and the landlord subsequently settled on a premium of £5,500 . If the lease had slid lower than eighty years, the amount would have become more costly by at least £1,025.
Mr Jude Gómez took over the lease of a one bedroom flat in Shepherd's Bush in February 2006. The question was if we could approximate the compensation to the landlord would be for a 90 year lease extension. Comparative flats in Shepherd's Bush with an extended lease were valued about £171,800. The average ground rent payable was £55 invoiced monthly. The lease ran out in 2076. Having 50 years unexpired we estimated the compensation to the landlord to extend the lease to be within £33,300 and £38,400 not including costs.
An example of a Freehold Enfranchisement matter before the tribunal for a Shepherd's Bush residence is 82 Minford Gardens in February 2009. The Tribunal determined that the enfranchisement price was £37,341 This case was in relation to 2 flats. The number of years remaining on the existing lease(s) was 72.92 years.