Halstead leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. Legislation has been in place for sometime now allowing qualifying Halstead residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Halstead you should check if your lease has between 70 and 90 years remaining. There are compelling reasons why a Halstead flat owner with a lease having around 80 years remaining should take action to make sure that a lease extension is effected without delay
Leasehold premises in Halstead with more than 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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 gives you better control over the value of your Halstead leasehold, as your property will be more valuable and saleable in relation to the lease length should you want to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Half a year ago Archie, started to get near to the 80-year threshold with the lease on his one bedroom flat in Halstead. In buying his flat two decades ago, the length of the lease was of no concern. Fortunately, he recognised he would imminently be paying way over the odds for Extending the lease. Archie arranged for a lease extension just ahead of time last August. Archie and the landlord who owned the flat above subsequently settled on an amount of £5,000 . If the lease had slid to less than eighty years, the amount would have become more costly by a minimum £1,125.
Dr Callum García owned a recently refurbished apartment in Halstead in September 1995. The question was if we could approximate the premium would likely be to extend the lease by an additional years. Comparative flats in Halstead with a long lease were in the region of £235,200. The average ground rent payable was £45 invoiced yearly. The lease expired in 2092. Considering the 66 years unexpired we calculated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 exclusive of professional charges.
Ms Charlotte Hernández moved into a one bedroom apartment in Halstead in July 2010. We are asked if we could shed any light on how much (approximately) premium would likely be to prolong the lease by a further 90 years. Comparable properties in Halstead with a long lease were worth £280,000. The average amount of ground rent was £55 collected every twelve months. The lease terminated on 11 February 2103. Considering the 77 years remaining we estimated the compensation to the freeholder to extend the lease to be within £13,300 and £15,400 not including costs.