Herne Hill leases on residential properties are gradually decreasing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. The majority of owners of residential leasehold property in Herne Hill enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Herne Hill you really ought to see if your lease has between 70 and ninety years left. In particular once the remaining lease term slips under 80 years, the compensation to the landlord for any lease extension sharply increases as an element of the premium you will incur is what is known as a marriage value
It is conventional wisdom that a residential leasehold with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an additional 90 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 |
|---|---|
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Herne Hill can be a difficult process. We recommend you secure professional help from a conveyancer and surveyor well versed in the legislation and lease extension process.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Herne Hill lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Freddie was the the leasehold proprietor of a 2 bedroom flat in Herne Hill being marketed with a lease of a little over 72 years outstanding. Freddie on an informal basis spoke with his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent to start with set at £150 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Freddie to invoke his statutory right. Freddie obtained expert legal guidance and was able to make a more informed judgement and handle with the matter and readily saleable.
In 2013 we were phoned by Mr and Mrs. Y Rodríguez who, having acquired a basement flat in Herne Hill in January 2009. We are asked if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Comparative premises in Herne Hill with 100 year plus lease were valued around £267,600. The mid-range ground rent payable was £65 invoiced quarterly. The lease lapsed on 12 February 2093. Taking into account 67 years unexpired we estimated the compensation to the freeholder to extend the lease to be within £14,300 and £16,400 exclusive of professional charges.
An example of a Freehold Enfranchisement decision for a Herne Hill premises is 66 Southwell Road in March 2012. By Order of Deputy District Judge Stone dated 25 January 2012 a vesting order was made. The determination of the purchase price was referred to the Tribunal who decided that the amount payable for the freehold should be£29,612.00 This case was in relation to 3 flats. The remaining number of years on the lease was 72.58 years.