The market value of West Barnes leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can escalate materialy once the remaining term is below than 80 years
It is conventional wisdom that a property with over 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Retaining our service will provide you enhanced control over the value of your West Barnes leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The conveyancers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
In 2014 Jason, came precariously close to the 80-year mark with the lease on his two bedroom flat in West Barnes. Having bought his flat two decades ago, the length of the lease was of minimal importance. Thankfully, it dawned on him that he would soon be paying an inflated amount for Extending the lease. Jason arranged for a lease extension just under the wire last May. Jason and the landlord in the end agreed on a premium of £5,000 . If he failed to meet the deadline, the figure would have escalated by at least £850.
In 2012 we were e-mailed by Dr G Lewis who, having owned a first floor apartment in West Barnes in February 1996. We are asked if we could shed any light on how much (roughly) price could be to prolong the lease by ninety years. Similar flats in West Barnes with 100 year plus lease were worth £270,000. The mid-range ground rent payable was £55 collected every twelve months. The lease ran out in 2100. Given that there were 75 years as a residual term we estimated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 plus costs.
An example of a Lease Extension decision for a West Barnes premises is Flat D 15 Claremont Gardens in September 2013. TheTribunal determined in accordance with section48 and Schedule13 of the Leasehold Reform,Housing and Urban Development Act 1993 that the premium for the extended lease should be fourteen thousand one hundred and eighty seven pounds (£14,187.00) This case was in relation to 1 flat.