Unfortunately that a Hessle residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the Hessle property prices.Once your lease gets to 85ish years, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease dips lower than eighty years - otherwise a higher amount will be due. The majority of flat owners in Hessle will be able to extend under the legislation; however a lawyer will be able to clarify whether you qualify for an extension. In some situations you may not qualify. There are also strict timetables and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancer throughout the process.
Leasehold properties in Hessle with more than one hundred years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and estate charges justify it.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
The conveyancing solicitors that we work with procure Hessle 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 conveyancing solicitor we work with provide it.
Joseph owned a high value flat in Hessle being marketed with a lease of just over 59 years unexpired. Joseph informally spoke with his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder indicated a willingness to extend the lease to 125 years on the basis of an increased rent to £100 yearly. No ground rent would be due on a lease extension were Joseph to invoke his statutory right. Joseph obtained expert legal guidance and secured an acceptable resolution without resorting to tribunal and sell the flat.
Last September we were phoned by Mr U King , who took over the lease of a one bedroom apartment in Hessle in August 2008. The dilemma was if we could estimate the premium would likely be for a ninety year lease extension. Comparable residencies in Hessle with a long lease were valued about £181,600. The average amount of ground rent was £55 invoiced yearly. The lease termination date was on 5 July 2077. Taking into account 52 years outstanding we approximated the compensation to the freeholder for the lease extension to be within £30,400 and £35,200 exclusive of costs.
In 2013 we were approached by Dr O Lefèvre who, having bought a basement flat in Hessle in October 2012. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be to prolong the lease by 90 years. Similar properties in Hessle with 100 year plus lease were valued around £290,000. The average ground rent payable was £45 invoiced yearly. The lease ended in 2097. Given that there were 72 years left we calculated the compensation to the landlord for the lease extension to be between £11,400 and £13,200 not including expenses.