Hilton leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease becomes more expensive. Legislation has been in place for sometime now which permits qualifying Hilton residential leaseholders to extend the terms of long leases. If you are a leasehold owner in Hilton you really ought to investigate if your lease has between 70 and ninety years left. There are compelling reasons why a Hilton leaseholder with a lease having around eighty years unexpired should take action to ensure that a lease extension is effected without delay
It is conventional wisdom that a property with more than one hundred years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 45 years remaining, the property will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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. |
| 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. |
The conveyancing solicitors that we work with undertake Hilton 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.
After protracted correspondence with the landlord of her one bedroom flat in Hilton, Georgina started the lease extension process just as her lease was nearing the all-important 80-year threshold. The transaction was finalised in September 2009. The landlord’s charges were negotiated to approximately 550 GBP.
Last Autumn we were phoned by Mr and Mrs. K Anderson , who bought a one bedroom apartment in Hilton in September 2000. The question was if we could shed any light on how much (roughly) premium would be to prolong the lease by a further 90 years. Comparative homes in Hilton with an extended lease were in the region of £225,400. The average ground rent payable was £45 collected every twelve months. The lease ran out in 2089. Given that there were 64 years remaining we calculated the premium to the freeholder to extend the lease to be between £15,200 and £17,600 exclusive of expenses.
Dr K Stewart owned a one bedroom apartment in Hilton in October 2012. We are asked if we could approximate the price would be for a ninety year lease extension. Comparable premises in Hilton with a long lease were worth £270,000. The average ground rent payable was £55 invoiced annually. The lease expired in 2100. Considering the 75 years unexpired we approximated the premium to the landlord to extend the lease to be within £9,500 and £11,000 plus expenses.