Unfortunately that a Hedon residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the Hedon property market.Once your lease nears 85ish years, you should start thinking about a lease extension. If lease term dips under 80 years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of leasehold owners in Hedon will be able to extend under the legislation; however a lawyer will be able to clarify if you qualify for an extension. In some cases you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the formalities.
It is generally considered that a property with more than one hundred years remaining is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Hedon,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Hedon valuers.
Caleb was the the leasehold proprietor of a 2 bedroom flat in Hedon being marketed with a lease of a few days over 61 years left. Caleb on an informal basis approached his landlord being a well known local-based freehold company for a lease extension. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £100 annually. Ordinarily, ground rent would not be due on a lease extension were Caleb to invoke his statutory right. Caleb obtained expert advice and was able to make an informed decision and deal with the matter and sell the property.
Last month we were phoned by Mr and Mrs. A González , who owned a recently refurbished apartment in Hedon in April 2009. The question was if we could shed any light on how much (roughly) premium would be for a ninety year lease extension. Similar flats in Hedon with 100 year plus lease were worth £275,000. The mid-range ground rent payable was £45 billed annually. The lease lapsed in 2095. Considering the 69 years left we calculated the compensation to the freeholder to extend the lease to be within £12,400 and £14,200 plus legals.
Dr Ryan Norbert bought a basement apartment in Hedon in November 2012. We are asked if we could estimate the compensation to the landlord would likely be for a ninety year lease extension. Similar properties in Hedon with a long lease were worth £216,000. The average ground rent payable was £60 invoiced per annum. The lease finished in 2084. Given that there were 58 years as a residual term we estimated the premium to the landlord for the lease extension to be within £28,500 and £33,000 plus professional charges.