Unfortunately that a Beacon Hill 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 deflation being disguised by increases in the Beacon Hill property market.Where your lease has approximately 90 years left, you need to start thinking about 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 under 80 years - otherwise a higher amount will be due. Most leasehold owners in Beacon Hill will be able to extend under the legislation; however a conveyancing solicitor should 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 follow once the process is initiated and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
It is conventional wisdom that a residential leasehold with more than 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be equivalent in value to 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. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with undertake Beacon Hill 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 lawyer we work with provide it.
Following protracted negotiations with the landlord of her first floor apartment in Beacon Hill, Jade initiated the lease extension process as the eighty year deadline was rapidly nearing. The transaction completed in April 2011. The landlord’s charges were kept to an absolute minimum.
Last Autumn we were called by Ms Nicole Taylor , who completed a one bedroom apartment in Beacon Hill in May 2005. The dilemma was if we could approximate the premium would likely be for a ninety year extension to my lease. Comparative flats in Beacon Hill with 100 year plus lease were worth £300,000. The average ground rent payable was £50 collected monthly. The lease ended in 2101. Having 75 years as a residual term we estimated the compensation to the freeholder for the lease extension to be within £8,600 and £9,800 plus fees.
Last Autumn we were called by Mr T Adams , who acquired a garden apartment in Beacon Hill in January 1996. The question was if we could shed any light on how much (roughly) compensation to the landlord would be to extend the lease by ninety years. Identical homes in Beacon Hill with 100 year plus lease were worth £250,400. The mid-range ground rent payable was £65 billed quarterly. The lease came to a finish in 2090. Given that there were 64 years as a residual term we estimated the premium to the freeholder to extend the lease to be within £19,000 and £22,000 not including fees.