Beacon 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 the lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Beacon Hill residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Beacon Hill you really ought to see if your lease has between seventy and ninety years left. In particular once the remaining lease term slips under 80 years, the cost of any lease extension sharply increases as an element of the premium you pay is what is known as a marriage value
It is conventional wisdom that a residential leasehold with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be worth the same as a freehold for many years ahead.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Lease extensions in Beacon Hill can be a difficult process. We recommend you get professional help from a conveyancer and valuer with experience in this area.
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 Beacon Hill lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Two years ago Luca, came seriously near to the eighty-year mark with the lease on his leasehold flat in Beacon Hill. In buying his home 18 years ago, the length of the lease was of no concern. As luck would have it, he recognised he needed to take action soon on a lease extension. Luca arranged for a lease extension just under the wire in June. Luca and the landlord subsequently settled on sum of £5,000 . If he not met the deadline, the amount would have increased by a minimum £1,125.
Dr Luca Allen bought a one bedroom apartment in Beacon Hill in January 2006. The question was if we could approximate the premium would likely be for a ninety year lease extension. Comparative properties in Beacon Hill with 100 year plus lease were worth £285,000. The mid-range amount of ground rent was £45 billed quarterly. The lease ended in 2097. Given that there were 72 years remaining we approximated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 plus legals.
Last Winter we were called by Mr Y Morel , who bought a one bedroom apartment in Beacon Hill in January 2012. We are asked if we could approximate the premium could be to extend the lease by a further 90 years. Comparative premises in Beacon Hill with a long lease were in the region of £233,200. The mid-range ground rent payable was £60 invoiced per annum. The lease lapsed in 2086. Considering the 61 years unexpired we estimated the premium to the freeholder for the lease extension to be between £22,800 and £26,400 plus legals.