The only way is down when it comes to West London lease terms. West London flats that have a remaining term lower than eighty years will reduce in value at a rapid rate, and the cost to extend your lease will go up.
It is conventional wisdom that a property with over one hundred years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Chelsea 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. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with handle 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 conveyancer we work with provide it.
George was the the leasehold proprietor of a studio flat in West London on the market with a lease of just over fifty eight years unexpired. George on an informal basis spoke with his freeholder a well known Bristol-based freehold company for a lease extension. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to a new rent to start with set at £150 per annum and doubled every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were George to invoke his statutory right. George obtained expert advice and secured an acceptable deal without resorting to tribunal and sell the flat.
In 2011 we were contacted by Mr Nathan Thompson who, having bought a ground floor flat in West London in May 2002. We are asked if we could shed any light on how much (roughly) price would be to prolong the lease by ninety years. Similar residencies in West London with an extended lease were worth £227,800. The average ground rent payable was £45 billed yearly. The lease expired on 2 October 2091. Considering the 65 years left we estimated the premium to the freeholder for the lease extension to be between £13,300 and £15,400 exclusive of legals.
An example of a Lease Extension matter before the tribunal 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.