With a domestic leasehold property in Hounslow, you are in fact renting it for a certain amount of time. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a lengthy period of time, you may consider a lease extension sooner rather than later. Accepted thinking is that the shorter the lease is the cost of extending the lease becomes disproportionately more expensive especially when there are less than 80 years left. Leasehold owners in Hounslow with a lease nearing 81 years unexpired should seriously think of extending it as soon as possible. Once a lease has below 80 years outstanding, under the relevant legislation the freeholder can calculate and charge a greater premium, assessed on a technical calculation, known as “marriage value” which is due.
It is conventional wisdom that a property with more than one hundred years unexpired lease term is worth approximately the same as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for decades to come.
| 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. |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with undertake Hounslow 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 conveyancer we work with provide it.
Kian owned a 2 bedroom flat in Hounslow being marketed with a lease of just over sixty years left. Kian informally approached his landlord a well known Bristol-based freehold company for a lease extension. The freeholder indicated a willingness to extend the lease to 125 years subject to a new rent at the outset set at £200 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Kian to exercise his statutory right. Kian procured expert legal guidance and was able to make an informed decision and deal with the matter and ending up with a market value flat.
In 2010 we were approached by Dr Bethan Rivera who, having acquired a basement apartment in Hounslow in February 2003. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord would be for a 90 year lease extension. Comparable residencies in Hounslow with 100 year plus lease were valued around £210,600. The mid-range amount of ground rent was £45 collected every twelve months. The lease ended in 2088. Taking into account 62 years remaining we estimated the compensation to the freeholder to extend the lease to be within £18,100 and £20,800 exclusive of expenses.
An example of a Lease Extension case for a Hounslow residence is Ground Floor Flat 91 Bath Road in May 2009. in a case where the freeholder could not be traced, the Brentford County Court ordered that the Lease be surrendered in return for the grant of a new lease of the Premises at a premium determined by the Leasehold Valuation Tribunal. The tribunal concluded that the price payable by the Applicant for the new lease of the premises be £15,900 This case related to 1 flat. The unexpired term was 60.45 years.