Unfortunately that a Hanham residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Hanham property prices.Where your lease has approximately 90 years left, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls below eighty years - otherwise a higher premium will be payable. Most flat owners in Hanham will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify whether you qualify for an extension. In some situations you may not qualify. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the process.
It is generally accepted that a property with over one hundred years unexpired lease term 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 worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Bank of Scotland | 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. |
| Halifax | 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service gives you increased control over the value of your Hanham leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
During the course of the last few months Tyler, came perilously near to the eighty-year mark with the lease on his purpose- built apartment in Hanham. In buying his property twenty years ago, the lease term was of no interest. Fortunately, he became aware that he would soon be paying way over the odds for Extending the lease. Tyler extended the lease just ahead of time in June. Tyler and the landlord subsequently agreed on the final figure of £5,500 . If he had missed the deadline, the sum would have become more costly by a minimum £1,075.
In 2012 we were phoned by Dr Reuben Roberts who, having bought a basement apartment in Hanham in February 2000. The question was if we could shed any light on how much (roughly) compensation to the landlord would be to prolong the lease by a further 90 years. Similar homes in Hanham with a long lease were in the region of £166,400. The average ground rent payable was £60 billed annually. The lease terminated in 2080. Given that there were 54 years outstanding we approximated the premium to the landlord for the lease extension to be between £32,300 and £37,400 exclusive of expenses.
In 2009 we were approached by Dr F Taylor who, having purchased a studio apartment in Hanham in January 1997. The question was if we could estimate the price would likely be to extend the lease by a further 90 years. Identical residencies in Hanham with an extended lease were in the region of £232,800. The average ground rent payable was £45 invoiced annually. The lease lapsed in 2091. Considering the 65 years outstanding we approximated the compensation to the landlord to extend the lease to be between £13,300 and £15,400 plus costs.