Strawberry Hill leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Strawberry Hill residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Strawberry Hill you must check if your lease has between 70 and 90 years left. There are good reasons why a Strawberry Hill leaseholder with a lease having around eighty years remaining should take steps to ensure that a lease extension is effected without delay
It is conventional wisdom that a property with more than 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years ahead.
| 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. |
| 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. |
| 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. |
The conveyancers that we work with undertake Strawberry Hill 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.
Following unsuccessful discussions with the landlord of her two bedroom flat in Strawberry Hill, Melissa initiated the lease extension process as the 80 year mark was fast nearing. The lease extension was concluded in October 2009. The freeholder’s charges were kept to an absolute minimum.
Mr Dexter Dupont took over the lease of a one bedroom flat in Strawberry Hill in August 1997. We are asked if we could estimate the price could be for a 90 year extension to my lease. Comparative residencies in Strawberry Hill with 100 year plus lease were worth £285,000. The average ground rent payable was £45 invoiced quarterly. The lease lapsed on 13 July 2096. Having 71 years left we approximated the premium to the landlord for the lease extension to be within £12,400 and £14,200 plus professional charges.
An example of a Lease Extension decision for a Strawberry Hill premises is Ground Floor Flat 91 Bath Road in May 2009. in a case where the freeholder could not be traced, the Brentford County Court ordered that the Lease be surrendered in return for the grant of a new lease of the Premises at a premium determined by the Leasehold Valuation Tribunal. The tribunal concluded that the price payable by the Applicant for the new lease of the premises be £15,900 This case was in relation to 1 flat. The unexpired residue of the current lease was 60.45 years.