For anyone whose Upney flat is held on a long lease, our message is clear – if nothing is done, your 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 expensive it will be to extend the lease.
Leasehold residencies in Upney with over one hundred years outstanding 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 property. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Retaining our service gives you increased control over the value of your Upney leasehold, as your property will be more valuable and saleable in terms of lease length should you wish to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Trailing unsuccessful negotiations with the freeholder of her leasehold flat in Upney, Rachel commenced the lease extension process as the 80 year threshold was fast nearing. The transaction was concluded in October 2008. The freeholder’s costs were kept to an absolute minimum.
In 2011 we were approached by Dr O García who, having moved into a one bedroom flat in Upney in August 2007. We are asked if we could shed any light on how much (approximately) compensation to the landlord would be to extend the lease by ninety years. Comparable properties in Upney with 100 year plus lease were worth £275,000. The average ground rent payable was £45 collected yearly. The lease lapsed in 2095. Considering the 69 years remaining we calculated the compensation to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of expenses.
An example of a Lease Extension case for a Upney residence is 49 Aldborough Road South in July 2012. The Tribunal decided that the premium payable for the grant of the new lease was £13,925 This case related to 1 flat. The unexpired lease term was 61.36 years.