On the balance of probabilities if you own a flat in Harold Wood you actually own a long leasehold interest over your property
It is conventional wisdom that a property with in excess of one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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. |
| Yorkshire 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. |
The conveyancing solicitors that we work with undertake Harold Wood 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.
Stanley was the the leasehold proprietor of a high value apartment in Harold Wood being sold with a lease of fraction over 72 years left. Stanley informally spoke with his landlord a well known Manchester-based freehold company for a lease extension. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Stanley to invoke his statutory right. Stanley obtained expert advice and secured an acceptable resolution informally and readily saleable.
In 2010 we were contacted by Mr and Mrs. V Mitchell who, having took over the lease of a basement apartment in Harold Wood in October 2000. The dilemma was if we could approximate the compensation to the landlord would be for a ninety year extension to my lease. Comparable flats in Harold Wood with a long lease were in the region of £254,200. The average amount of ground rent was £60 billed quarterly. The lease ran out in 2077. Considering the 51 years left we approximated the premium to the freeholder for the lease extension to be between £43,700 and £50,600 not including costs.
An example of a Lease Extension case for a Harold Wood property is 37 Lodge Court High Street in November 2013. the decision of the LVT was that the premium to be paid for the new lease was £25,559 This case was in relation to 1 flat. The unexpired term was 57.5 years.