The market value of a leasehold property in Tooting depends on how many years the lease has remaining. If it is near to or fewer than 80 years you should envisage problems on re-sale, so it is recommended to arrange for the lease to be extended prior to buying. It is preferable to start the lease extension process when a lease still has 82 years unexpired so that formalities can be finalised prior to the 80 year mark. Current legislation enables Tooting qualifying lessees to a 90 year extension added to their unexpired lease term (ie if your lease has 50 years left the statutory lease extension will provide a new term of 140 years). The purpose of the valuation is to determine the premium payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold properties in Tooting with in excess of one hundred years unexpired on the lease are often 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 maintenance charges warrant it.
| 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. |
| Halifax | Minimum 70 years from the date 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service gives you enhanced control over the value of your Tooting leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Following unsuccessful negotiations with the landlord of her garden apartment in Tooting, Georgina started the lease extension process just as her lease was coming close to the critical eighty-year deadline. The legal work was finalised in November 2012. The freeholder’s costs were kept to an absolute minimum.
In 2009 we were approached by Mr and Mrs. E Evans who, having purchased a purpose-built apartment in Tooting in May 2006. The question was if we could estimate the compensation to the landlord would be for a ninety year lease extension. Comparative residencies in Tooting with an extended lease were valued about £193,400. The mid-range amount of ground rent was £65 invoiced quarterly. The lease terminated in 2084. Taking into account 59 years unexpired we estimated the premium to the freeholder to extend the lease to be within £21,900 and £25,200 not including fees.
An example of a Lease Extension case for a Tooting flat is 14 Nutwell Street in January 2014. The premium payable for the acquisition of a new lease of the subject premises was in the sum of £30,523 This case affected 1 flat. The remaining number of years on the lease was 62.94 years.