The market value of Victoria leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can escalate substantially once the unexpired lease term is less than eighty years
It is conventional wisdom that a property with in excess of one hundred years remaining is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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. |
Engaging our service gives you better control over the value of your Victoria leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The conveyancing solicitors that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Tommy was the the leasehold proprietor of a 2 bedroom apartment in Victoria being sold with a lease of fraction over 61 years left. Tommy informally contacted his freeholder being a well known London-based freehold company for a lease extension. The landlord indicated a willingness to extend the lease to 125 years subject to an increased rent to £50 annually. No ground rent would be payable on a lease extension were Tommy to exercise his statutory right. Tommy obtained expert legal guidance and secured an acceptable deal informally and sell the property.
Mr and Mrs. H Garcia was assigned a lease of a one bedroom apartment in Victoria in August 1998. We are asked if we could approximate the premium would be for a 90 year extension to my lease. Comparative homes in Victoria with an extended lease were in the region of £280,000. The average ground rent payable was £55 billed every twelve months. The lease ended in 2104. Given that there were 78 years unexpired we calculated the premium to the landlord to extend the lease to be between £13,300 and £15,400 exclusive of fees.
An example of a Lease Extension matter before the tribunal for a Victoria premises is Flats 12A & 19, Evelyn Mansions Carlisle Place in June 2009. The Tribunal held that the price to be paid for the new lease of Flat 12A is £168,824, For the other flat the price was set at £169,110 This case was in relation to 2 flats. The unexpired term was 56 years.