Unfortunately that a Streatham residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the Streatham property market.Where your lease has approximately 90 years left, you should start thinking about a lease extension. If the number of years remaining slips below 80 years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property Most flat owners in Streatham will be able to extend under the legislation; however a lawyer should be able to confirm whether you are eligibility. In some cases you may not qualify. There are also strict timeframes and procedures to follow once the process is initiated and you will need to be guided by your lawyer for the duration of the process.
Leasehold residencies in Streatham with over one hundred years outstanding on the lease are sometimes referred to as ‘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 |
|---|---|
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with handle Streatham 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 conveyancer we work with provide it.
Last October Michael, came critically close to the 80-year threshold with the lease on his ground floor apartment in Streatham. In buying his property 18 years previously, the length of the lease was of minimal significance. Luckily, he became aware that he needed to take action soon on Extending the lease. Michael extended the lease at the eleventh hour in May. Michael and the freeholder via the management company subsequently settled on the final figure of £5,500 . If the lease had fallen to less than 80 years, the amount would have increased by at least £950.
Mr and Mrs. V Rogers moved into a recently refurbished apartment in Streatham in January 2009. The question was if we could shed any light on how much (roughly) premium could be to extend the lease by 90 years. Similar homes in Streatham with an extended lease were worth £225,400. The average ground rent payable was £45 collected per annum. The lease came to a finish on 21 January 2090. Taking into account 64 years remaining we estimated the premium to the freeholder for the lease extension to be between £16,200 and £18,600 not including legals.
An example of a Lease Extension case for a Streatham premises is Flat 12, Newlands Court Streatham Common North in May 2012. the decision of the Tribunal was that the premium payable by the Applicants to the Respondent for the new lease of the Premises be £70,140. This case was in relation to 1 flat. The unexpired residue of the current lease was 23.25 years.