For those whose Stone Cross flat is held on a long lease, our message is clear – if you do nothing, the property will eventually revert to your landlord, leaving you empty-handed. The fewer the years remaining the lower the value of the property and the more it will cost to extend the lease.
It is conventional wisdom that a property with more than one hundred years remaining is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Using our service will provide you enhanced control over the value of your Stone Cross leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Following unsuccessful discussions with the freeholder of her studio flat in Stone Cross, Alicia started the lease extension process just as the lease was nearing the crucial eighty-year threshold. The lease extension was finalised in November 2013. The freeholder’s charges were restricted to approximately five hundred pounds.
Last Christmas we were called by Mr Jackson Mercier , who bought a purpose-built flat in Stone Cross in May 1999. We are asked if we could shed any light on how much (roughly) price would likely be to extend the lease by ninety years. Similar flats in Stone Cross with 100 year plus lease were worth £191,400. The mid-range amount of ground rent was £55 collected per annum. The lease came to a finish on 10 November 2080. Given that there were 54 years remaining we estimated the premium to the landlord to extend the lease to be within £34,200 and £39,600 not including fees.
Mr and Mrs. F Ali was assigned a lease of a studio flat in Stone Cross in September 2001. We are asked if we could approximate the compensation to the landlord could be for a 90 year lease extension. Comparable premises in Stone Cross with a long lease were in the region of £290,000. The mid-range ground rent payable was £45 collected quarterly. The lease came to a finish in 2100. Considering the 74 years outstanding we estimated the compensation to the landlord to extend the lease to be between £8,600 and £9,800 exclusive of costs.