Haringey leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. It is the case that most Haringey tenants have the right to extend their lease by an additional ninety years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in Haringey you really ought to investigate if your lease has between 70 and 90 years left. In particular once the remaining lease term slips under 80 years, the compensation to the landlord for any lease extension increases dramatically as part of the premium you pay is what is known as a marriage value
Leasehold premises in Haringey with in excess of 100 years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such situations there is often little to be gained by buying the freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| Godiva Mortgages | 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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 also be not less than 75 years at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with procure Haringey 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 lawyer we work with provide it.
In 2014 Austin, came very close to the eighty-year threshold with the lease on his leasehold apartment in Haringey. In buying his home two decades ago, the unexpired term was of minimal importance. Fortunately, he noticed he would soon be paying an escalated premium for Extending the lease. Austin arranged for a lease extension just in the nick of time in April. Austin and the freeholder via the management company ultimately settled on the final figure of £6,000 . If he failed to meet the deadline, the sum would have become more costly by a minimum £900.
In 2010 we were approached by Dr A Leroy who, having owned a first floor flat in Haringey in May 2010. The question was if we could approximate the premium could be for a 90 year lease extension. Identical properties in Haringey with 100 year plus lease were valued about £280,000. The average ground rent payable was £55 invoiced per annum. The lease came to a finish on 20 August 2104. Taking into account 79 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 exclusive of fees.
An example of a Lease Extension matter before the tribunal for a Haringey residence is 16 Langham Close in June 2009. The Tribunal determined that the premium to be paid by the Applicant to the Respondent for the grant of a new lease was £45,672. This case was in relation to 1 flat. The remaining number of years on the lease was 25.4 years.