West London leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. The majority of owners of residential leasehold property in West London enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in West London you should investigate if your lease has between seventy and 90 years left. There are good reasons why a West London leaseholder with a lease having around 80 years unexpired should take action to make sure that a lease extension is effected without delay
It is conventional wisdom that a property with more than 100 years remaining is worth roughly the same as a freehold. Where an further ninety years added to any lease with more than 30 years remaining, the residence will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with procure West London lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Jackson was the the leasehold proprietor of a high value apartment in West London being marketed with a lease of a few days over 59 years left. Jackson informally approached his freeholder being a well known local-based freehold company and enquired on a premium to extend the lease. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years on the basis of a new rent to start with set at £150 per annum and increase every twenty five years thereafter. No ground rent would be due on a lease extension were Jackson to invoke his statutory right. Jackson obtained expert legal guidance and secured an acceptable resolution informally and sell the flat.
In 2014 we were contacted by Dr Courtney Moore who, having completed a recently refurbished flat in West London in November 2010. The question was if we could shed any light on how much (approximately) compensation to the landlord would be to prolong the lease by a further 90 years. Similar flats in West London with an extended lease were worth £275,000. The average amount of ground rent was £55 invoiced every twelve months. The lease lapsed in 2103. Considering the 77 years left we approximated the premium to the freeholder to extend the lease to be between £13,300 and £15,400 exclusive of costs.
An example of a Lease Extension decision for a West London premises is 137 & 139 Haberdasher Street in December 2013. The Tribunal determines in accordance with section 48 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 that the premium for the extended lease for each Property should be £12,350.00. This case related to 2 flats. The number of years remaining on the existing lease(s) was 72.39 years.