The value of Colney Hatch leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of a lease extension can escalate materialy once the unexpired lease term is less than eighty years
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 30 years unexpired, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
The conveyancers that we work with handle Colney Hatch 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.
Jamie owned a 2 bedroom apartment in Colney Hatch being marketed with a lease of a few days over 59 years remaining. Jamie on an informal basis contacted his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years on the basis of a new rent initially set at £200 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Jamie to exercise his statutory right. Jamie obtained expert legal guidance and was able to make a more informed judgement and handle with the matter and ending up with a market value flat.
Mr Matthew Mercier took over the lease of a basement apartment in Colney Hatch in March 2001. We are asked if we could approximate the price would likely be to prolong the lease by ninety years. Similar premises in Colney Hatch with an extended lease were valued around £295,000. The average amount of ground rent was £45 billed quarterly. The lease elapsed in 2100. Having 74 years unexpired we calculated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 not including expenses.
An example of a Lease Extension matter before the tribunal for a Colney Hatch property is 90 & 96 Poplar Grove in June 2013. It was held by the Tribunal that the premium to be paid for the new lease in respect of each of the flats referred should be £17,942 This case affected 2 flats. The unexpired term was 68 years.