With a long leasehold premises in Hale Barns, you are in fact renting it for a certain period of time. In recent years flat leases are usually granted for 99 years or 125. Even though this may appear like a lengthy period of time, you may think about extending the lease sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease gets disproportionately greater especially once there are less than eighty years left. Anyone in Hale Barns with a lease drawing near to 81 years unexpired should seriously think of extending it as soon as possible. When a lease has under eighty years remaining, under the current Act the freeholder can calculate and demand a greater premium, based on a technical computation, known as “marriage value” which is payable.
It is conventional wisdom that a property with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Coventry Building Society | 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. |
Using our service will provide you better control over the value of your Hale Barns leasehold, as your property will be more valuable and saleable in terms of lease length should you decide to sell. The conveyancing solicitors that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Last year Tommy, came critically near to the eighty-year threshold with the lease on his first floor apartment in Hale Barns. In buying his home two decades ago, the length of the lease was of no concern. Luckily, it dawned on him that he would soon be paying way over the odds for a lease extension. Tommy extended the lease at the eleventh hour in April. Tommy and the freeholder subsequently agreed on sum of £5,500 . If he failed to meet the deadline, the price would have increased by at least £1,075.
In 2014 we were e-mailed by Mr U Vincent who, having bought a garden apartment in Hale Barns in June 2006. The dilemma was if we could approximate the price could be for a ninety year extension to my lease. Comparative premises in Hale Barns with an extended lease were in the region of £250,000. The mid-range amount of ground rent was £50 invoiced monthly. The lease elapsed in 2094. Considering the 68 years outstanding we approximated the compensation to the landlord to extend the lease to be within £9,500 and £11,000 not including legals.
Dr H Campbell bought a basement apartment in Hale Barns in April 2011. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be for a ninety year extension to my lease. Comparative residencies in Hale Barns with 100 year plus lease were worth £285,000. The mid-range ground rent payable was £55 collected every twelve months. The lease terminated on 5 March 2105. Taking into account 79 years outstanding we calculated the premium to the freeholder for the lease extension to be between £13,300 and £15,400 exclusive of legals.