Owning a flat usually means owning a lease of the property, which has a finite term of years. The lease will usually be granted for a set period of time , ordinarily 99 or 125 years, although we have come across longer and shorter terms in Hartfield. Inevitably, the period of lease left reduces over time. This is often overlooked and only raises itself as an issue when the residence has to be disposed of or re-mortgaged. The shorter the lease the lower the value of the property and the more it will cost to extend the lease. Qualifying leaseholders in Hartfield have the legal entitlement to extend the lease for a further 90 years under the 1993 Leasehold Reform Act. You should give due consideration before delaying your Hartfield lease extension. Putting off that expense now likely increases the price you will eventually incur for a lease extension
It is generally considered that a residential leasehold with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety 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 |
|---|---|
| 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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 |
| 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. |
Regardless of whether you are a tenant or a freeholder in Hartfield,the lease extension experts 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 Hartfield valuers.
Following lengthy discussions with the freeholder of her basement apartment in Hartfield, Chloe initiated the lease extension process just as the lease was nearing the crucial 80-year threshold. The transaction completed in May 2007. The freeholder’s fees were restricted to a tad over 550 GBP.
Dr R Taylor moved into a purpose-built flat in Hartfield in March 2004. The dilemma was if we could estimate the compensation to the landlord would be for a ninety year lease extension. Comparable flats in Hartfield with an extended lease were worth £235,200. The average amount of ground rent was £45 billed per annum. The lease came to a finish on 22 September 2091. Considering the 66 years unexpired we calculated the premium to the landlord to extend the lease to be between £12,400 and £14,200 not including professional charges.
In 2011 we were phoned by Dr Ibrahim Walker who, having completed a newly refurbished flat in Hartfield in July 2010. We are asked if we could shed any light on how much (roughly) premium could be for a 90 year lease extension. Comparative homes in Hartfield with a long lease were valued around £275,000. The average amount of ground rent was £55 collected monthly. The lease ended on 15 May 2102. Taking into account 77 years outstanding we estimated the premium to the freeholder for the lease extension to be between £13,300 and £15,400 exclusive of legals.