Toddington leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. It is the case that most Toddington tenants have the right to extend their lease by an additional 90 years under the 1993 Leasehold Reform Act. If you are a leasehold owner in Toddington you would be well advised to see if your lease has between 70 and ninety years remaining. There are compelling reasons why a Toddington flat owner with a lease having around eighty years remaining should take action to ensure that a lease extension is effected without delay
Leasehold properties in Toddington with more than one hundred years unexpired 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 |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a landlord in Toddington,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Toddington valuers.
Following unsuccessful discussions with the landlord of her purpose-built apartment in Toddington, Erin started the lease extension process just as the lease was approaching the critical 80-year threshold. The lease extension completed in November 2010. The freeholder’s costs were kept to an absolute minimum.
Last month we were contacted by Mr and Mrs. F Wilson , who purchased a one bedroom flat in Toddington in January 2007. The dilemma was if we could estimate the price would likely be for a ninety year lease extension. Comparable homes in Toddington with a long lease were in the region of £227,800. The average ground rent payable was £45 collected annually. The lease ended on 12 September 2091. Considering the 65 years unexpired we calculated the compensation to the landlord for the lease extension to be between £13,300 and £15,400 not including expenses.
Mr W Martinez was assigned a lease of a first floor flat in Toddington in July 2005. The dilemma was if we could estimate the price would likely be to prolong the lease by an additional years. Identical flats in Toddington with 100 year plus lease were valued about £275,000. The average amount of ground rent was £55 invoiced quarterly. The lease lapsed in 2102. Having 76 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 plus fees.