The re-sale value of a leasehold property in Harringay depends on how long the lease has remaining. If it is near to or less than eighty years you should foresee problems on re-sale, so it is recommended to arrange for a lease extension before buying. It is preferable to start the lease extension process when a lease still has 82 years unexpired so that a lease extension can be addressed in advance of the 80 year threshold. Statute entitles Harringay qualifying lessees to obtain a new lease which will be for the balance of the existing lease plus a further term of 90 years. The reason of the valuation is to determine the premium payable by the lessee to the freeholder for the purchase of the lease extension.
It is generally accepted that a residential leasehold with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
The conveyancers that we work with handle Harringay 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.
Ali was the the leasehold owner of a 2 bedroom apartment in Harringay on the market with a lease of fraction over sixty years unexpired. Ali on an informal basis spoke with his freeholder being a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to a rise in the rent to £125 per annum. Ordinarily, ground rent would not be payable on a lease extension were Ali to exercise his statutory right. Ali procured expert advice and was able to make an informed decision and deal with the matter and sell the property.
Last Christmas we were phoned by Mr and Mrs. B Harris , who took over the lease of a recently refurbished flat in Harringay in October 1998. We are asked if we could approximate the premium would be to extend the lease by a further 90 years. Comparable premises in Harringay with 100 year plus lease were worth £235,600. The mid-range amount of ground rent was £60 billed quarterly. The lease came to a finish on 23 May 2087. Considering the 62 years unexpired we approximated the compensation to the freeholder to extend the lease to be within £21,900 and £25,200 exclusive of expenses.
An example of a Freehold Enfranchisement case for a Harringay residence is 37 St. Margarets Avenue in January 2010. Following a vesting order by Edmonton County Court on 8th November 2008 the Tribunal decided that the price that the Applicant for the freehold interest should pay is £20,543 This case was in relation to 2 flats. The remaining number of years on the lease was 74.75 years.