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Why you should commence your Shepherd's Bush lease extension

Top reasons for lease extension now:

Increase your lease and increase your Shepherd's Bush property value

Shepherd's Bush leases on residential properties are gradually losing value. Where your lease has approximately ninety years unexpired, you should start thinking about a lease extension. If lease term is less than eighty years, you will then have to pay half of the property's 'marriage value' on top of the standard cost of the lease extension to your landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Leasehold owners in Shepherd's Bush will mostly be legally entitled to a lease extension; however a solicitor should be able confirm if you qualify. In some circumstances you may not be entitled. There are prescribed deadlines and steps to comply with once the process is initiated so it’s sensible to be guided by a conveyancing solicitor during the process.

Shepherd's Bush property with a lease extension has roughly the same value as a freehold

Leasehold residencies in Shepherd's Bush with more than one hundred years unexpired on the lease are often referred to as ‘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 buying the reversionary interest unless savings on ground rent and service charges merit it.

Lenders may decide not to loan monies on a short lease

Mortgage companies are inclined not lend on short residential leases. You are likely to experience difficulties if you wish to sell your flat in Shepherd's Bush if the unexpired lease term is under the criteria set by the majority of mortgage companies. Different mortgage companies have different requirements but in the main theyrequire an unexpired term of at least 65 years.

Lender Requirement
Bank of Scotland Minimum 70 years from the date of the mortgage.
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;
Chelsea 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.
Lloyds TSB Scotland Minimum 70 years from the date of the mortgage.
National Westminster Bank Mortgage term plus 30 years.

What makes us experts in Shepherd's Bush lease extensions?

Regardless of whether you are a tenant or a landlord in Shepherd's Bush,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Shepherd's Bush valuers.

Shepherd's Bush Lease Extension Example Cases:

Arthur, Shepherd's Bush, West London,

Arthur was the the leasehold owner of a high value flat in Shepherd's Bush being marketed with a lease of a little over 59 years unexpired. Arthur on an informal basis contacted his landlord a well known Manchester-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 rise in the rent to £100 annually. Ordinarily, ground rent would not be payable on a lease extension were Arthur to invoke his statutory right. Arthur obtained expert advice and secured satisfactory resolution without going to tribunal and sell the flat.

Shepherd's Bush case:

Mr M Bell took over the lease of a basement flat in Shepherd's Bush in March 2012. We are asked if we could approximate the price would likely be for a 90 year extension to my lease. Comparable properties in Shepherd's Bush with 100 year plus lease were worth £206,200. The average ground rent payable was £55 billed quarterly. The lease lapsed on 17 October 2080. Given that there were 56 years left we approximated the premium to the freeholder to extend the lease to be within £31,400 and £36,200 plus legals.

Decision in Hammersmith and Fulham

An example of a Freehold Enfranchisement decision for a Shepherd's Bush property 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 unexpired residue of the current lease was 72.92 years.