East Barnet 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 your lease gets more expensive. Legislation has been in place for sometime now allowing qualifying East Barnet residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in East Barnet you must investigate if your lease has between 70 and 90 years remaining. In particular once the remaining lease term slips under eighty years, the premium due on any lease extension increases dramatically as part of the premium you will incur is what is known as a marriage value
Leasehold properties in East Barnet with over 100 years left on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset 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. |
| 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. |
Engaging our service will provide you better control over the value of your East Barnet leasehold, as your property will be more valuable and saleable in terms of lease length should you want to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Following lengthy correspondence with the freeholder of her basement apartment in East Barnet, Robyn initiated the lease extension process just as her lease was nearing the critical 80-year deadline. The lease extension completed in August 2012. The freeholder’s fees were kept to an absolute minimum.
Mr and Mrs. V Campbell acquired a ground floor flat in East Barnet in January 2000. The dilemma was if we could approximate the price would likely be to extend the lease by ninety years. Identical homes in East Barnet with a long lease were in the region of £265,000. The mid-range amount of ground rent was £50 billed every twelve months. The lease end date was in 2099. Considering the 73 years unexpired we approximated the premium to the freeholder for the lease extension to be within £9,500 and £11,000 plus costs.
An example of a Freehold Enfranchisement decision for a East Barnet residence is 23 Beaconsfield Road in July 2013. The Tribunals decided that the amount payable was £31,203 for the freehold. This case related to 2 flats. The unexpired lease term was 70.31 years.