The only way is down when it comes to Southwark lease terms. Southwark properties that have a remaining term lower than eighty years will drop in market price even faster, and the cost to extend your lease will rise.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for decades to come.
| 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 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
Regardless of whether you are a tenant or a landlord in Southwark,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Southwark valuers.
Subsequent to protracted correspondence with the freeholder of her first floor apartment in Southwark, Rebecca initiated the lease extension process as the eighty year threshold was fast nearing. The transaction was finalised in July 2009. The landlord’s fees were kept to an absolute minimum.
In 2010 we were contacted by Mrs Rebecca Girard who, having bought a studio apartment in Southwark in April 1997. We are asked if we could estimate the premium would be for a ninety year lease extension. Similar flats in Southwark with a long lease were worth £186,000. The mid-range amount of ground rent was £65 collected every twelve months. The lease ran out in 2084. Having 58 years unexpired we calculated the compensation to the landlord to extend the lease to be between £24,700 and £28,600 not including legals.
An example of a Freehold Enfranchisement matter before the tribunal for a Southwark premises is 1-41 Royal Tower Lodge 40 Cartwright Street in April 2013. the tribunal adding the agreed value of capitalised ground rents and the reversion the price to be paid for the freehold was £1,187,000 This case was in relation to 41 flats. The unexpired term as at the valuation date was 107 years.