Unfortunately that a Friern Barnet residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the Friern Barnet property market.Once your lease gets to 85ish years, you should start thinking about a lease extension. If lease term drops under 80 years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property Most leasehold owners in Friern Barnet will be able to extend under the legislation; however a conveyancer should be able to clarify if you qualify for an extension. In some cases you may not qualify. There are also strict timeframes and procedures to follow once the process is instigated and you will need to be guided by your lawyer for the duration of the formalities.
It is conventional wisdom that a property with more than 100 years remaining is worth approximately the same 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 decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
The conveyancing solicitors that we work with procure Friern Barnet 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.
In recent months Gabriel, started to get near to the eighty-year mark with the lease on his basement flat in Friern Barnet. In buying his property two decades ago, the length of the lease was of little interest. Fortunately, he noticed he would soon be paying an escalated premium for Extending the lease. Gabriel extended the lease just ahead of time in March. Gabriel and the freeholder via the managing agents subsequently settled on the final figure of £5,000 . If the lease had fallen below eighty years, the amount would have escalated by at least £1,150.
Dr Callum Lambert acquired a one bedroom flat in Friern Barnet in March 2000. We are asked if we could approximate the price would be to prolong the lease by 90 years. Identical flats in Friern Barnet with a long lease were valued around £246,800. The mid-range ground rent payable was £60 collected quarterly. The lease lapsed on 16 July 2076. Considering the 50 years left we calculated the compensation to the freeholder to extend the lease to be within £44,700 and £51,600 plus expenses.
An example of a Lease Extension decision for a Friern Barnet residence is 34 Poplar Grove in June 2013. The Tribunal directed that the premium for the lease extension should be in the sum of £10,250. This case related to 1 flat.