South London leases on domestic deteriorating in value. if your lease has approximately ninety years unexpired, you should start thinking about a lease extension. If lease term is under 80 years, you will then have to pay half of the property's 'marriage value' in addition to the standard cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Flat owners in South London will usually qualify for a lease extension; however a solicitor will check if you qualify. In some circumstances you may not be entitled. There are prescribed deadlines and procedures to comply with once the process is initiated so it’s prudent to be guided by a conveyancing solicitor during the process.
Leasehold premises in South London with in excess of one hundred years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges justify it.
| 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 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; |
| 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. |
| 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. |
Irrespective of whether you are a tenant or a landlord in South London,the lease extension solicitors 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 South London valuers.
In the wake of eight months of unsuccessful discussions with the freeholder of her basement flat in South London, Rebecca started the lease extension process as the eighty year threshold was quickly advancing. The legal work completed in October 2006. The landlord’s costs were restricted to under 650 GBP.
Last Winter we were contacted by Dr H Gunderson , who acquired a newly refurbished flat in South London in October 2000. The dilemma was if we could shed any light on how much (roughly) price would be for a 90 year lease extension. Similar homes in South London with an extended lease were valued about £285,000. The average amount of ground rent was £45 invoiced quarterly. The lease end date was in 2096. Having 71 years outstanding we calculated the premium to the landlord for the lease extension to be between £12,400 and £14,200 not including expenses.
An example of a Lease Extension case for a South London residence is Flat B 10 Grove Avenue in October 2013. Following a vesting order Clerkenwell and Shoreditch County Court 3rd July 2013 The tribunal determines that the premium payable for the lease extension was £36,215.00 This case affected 1 flat. The remaining number of years on the lease was 65.21 years.