The re-sale value of a leasehold property in Harlesden depends on how many years the lease has remaining. If it is close to or less than 80 years you should anticipate problems on re-sale, so it is recommended to arrange for the lease to be extended prior to buying. It is preferable to commence the lease extension process when the lease still has 82 years to run so that formalities can be finalised ahead of the 80 year threshold. Leasehold Reform legislation entitles Harlesden qualifying lessees to an additional term of 90 years over and above the unexpired term, at a nominal rent (no ground rent). The reason of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold properties in Harlesden with over 100 years unexpired on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Regardless of whether you are a tenant or a freeholder in Harlesden,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Harlesden valuers.
Subsequent to protracted negotiations with the landlord of her studio flat in Harlesden, Georgia commenced the lease extension process just as the lease was coming close to the crucial eighty-year threshold. The legal work was concluded in September 2006. The freeholder’s charges were negotiated to below 650 GBP.
In 2010 we were contacted by Mr and Mrs. B Gunderson who, having bought a basement flat in Harlesden in November 1998. The question was if we could estimate the price would likely be to extend the lease by a further 90 years. Comparable residencies in Harlesden with a long lease were in the region of £208,200. The average amount of ground rent was £65 billed per annum. The lease termination date was in 2086. Considering the 61 years left we estimated the compensation to the landlord to extend the lease to be within £20,000 and £23,000 not including legals.
An example of a Lease Extension decision for a Harlesden residence is First Floor Flat 2B Fortune Gate Road in May 2013. the tribunal decided that the price payable for the lease extension was £9,331, together with £900 in respect of outstanding ground rent. This case was in relation to 1 flat. The unexpired lease term was 74.31 years.