For those whose St John's Wood flat is held on a long lease, our message is clear – if nothing is done, your property will eventually revert to the freeholder, leaving you empty-handed. The fewer the years remaining the less it is worth and the more expensive it will be to obtain a lease extension.
Leasehold properties in St John's Wood with more than one hundred years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 |
| 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. |
The lawyers that we work with handle St John's Wood lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancing solicitor we work with provide it.
Freddie owned a studio apartment in St John's Wood on the market with a lease of a little over 59 years unexpired. Freddie on an informal basis approached his freeholder being a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a new rent at the outset set at £200 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Freddie to exercise his statutory right. Freddie obtained expert legal guidance and was able to make a more informed judgement and deal with the matter and ending up with a market value flat.
In 2009 we were e-mailed by Mr and Mrs. W Laurent who, having was assigned a lease of a basement apartment in St John's Wood in October 2001. We are asked if we could estimate the price could be for a 90 year lease extension. Similar premises in St John's Wood with 100 year plus lease were in the region of £166,400. The average ground rent payable was £60 invoiced per annum. The lease terminated on 14 March 2079. Taking into account 54 years remaining we calculated the premium to the landlord to extend the lease to be between £32,300 and £37,400 exclusive of legals.
An example of a Lease Extension decision for a St John's Wood premises is Garden Flat 195 Goldhurst Terrace in May 2012. The Tribunal held in accordance with section 48 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 that the premium for the extended lease should be £60,855.00. This case related to 1 flat. The unexpired term was 60.16 years.