Berkhamsted leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease becomes more expensive. It is the case that most Berkhamsted tenants have the right to extend their lease by an additional 90 years by virtue of the 1993 Leasehold Reform Act. If you are a leasehold owner in Berkhamsted you really ought to investigate if your lease has between 70 and 90 years remaining. There are compelling reasons why a Berkhamsted flat owner with a lease having around 80 years remaining should take action to ensure that a lease extension is actioned without delay
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth roughly the same as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Berkhamsted can be a difficult process. We recommend you procure 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 in-depth market knowledge dealing with Berkhamsted lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
During the course of the last few months Thomas, came critically close to the eighty-year threshold with the lease on his purpose- built flat in Berkhamsted. In buying his property 19 years ago, the length of the lease was of little concern. Fortunately, he realised he would soon be paying an escalated premium for a lease extension. Thomas extended the lease just under the wire in March. Thomas and the landlord eventually agreed on an amount of £5,000 . If he failed to meet the deadline, the sum would have increased by a minimum £875.
In 2010 we were approached by Mr and Mrs. C Hall who, having was assigned a lease of a basement flat in Berkhamsted in May 2006. We are asked if we could estimate the premium would be to prolong the lease by a further 90 years. Comparative homes in Berkhamsted with 100 year plus lease were worth £250,000. The average amount of ground rent was £50 invoiced yearly. The lease ended in 2095. Taking into account 69 years left we estimated the compensation to the landlord for the lease extension to be within £9,500 and £11,000 not including fees.
Mr and Mrs. K Khan moved into a ground floor apartment in Berkhamsted in October 2009. We are asked if we could estimate the premium would be for a 90 year extension to my lease. Comparable properties in Berkhamsted with an extended lease were valued about £290,000. The average ground rent payable was £60 invoiced monthly. The lease ran out on 26 June 2106. Having 80 years remaining we approximated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 plus professional charges.