Hackenthorpe leases on domestic deteriorating in value. Where your lease has about 90 years remaining, you should start considering the need for a lease extension. If lease term dips under eighty years, you will then have to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to your landlord. Marriage value is the amount of additional value that a lease extension will add to the property. Flat owners in Hackenthorpe will mostly qualify for a lease extension; however It would be wise to check with a conveyancer to confirm your eligibility. In some circumstances you may not qualify. There are also strict deadlines and procedures to comply with once the process has commenced so it’s wise to be guided by a conveyancer during the process.
It is generally considered that a residential leasehold with more than one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be equivalent in value to a freehold for decades to come.
| 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. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
The lawyers that we work with handle Hackenthorpe 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 conveyancer we work with provide it.
Evan owned a studio apartment in Hackenthorpe on the market with a lease of a little over 59 years left. Evan on an informal basis contacted his freeholder a well known Bristol-based freehold company for a lease extension. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £125 yearly. Ordinarily, ground rent would not be payable on a lease extension were Evan to exercise his statutory right. Evan obtained expert advice and was able to make a more informed judgement and handle with the matter and ending up with a market value flat.
Mr and Mrs. W Alexander was assigned a lease of a garden apartment in Hackenthorpe in November 2007. The question was if we could approximate the price would likely be to extend the lease by a further 90 years. Identical flats in Hackenthorpe with an extended lease were worth £254,200. The average ground rent payable was £60 collected yearly. The lease termination date was in 2077. Considering the 51 years outstanding we approximated the compensation to the landlord to extend the lease to be within £43,700 and £50,600 exclusive of expenses.
In 2013 we were phoned by Mrs Sian Reed who, having owned a studio apartment in Hackenthorpe in June 2011. The dilemma was if we could estimate the premium would be for a ninety year lease extension. Comparative premises in Hackenthorpe with a long lease were in the region of £210,600. The average amount of ground rent was £45 invoiced quarterly. The lease expired on 24 May 2088. Taking into account 62 years outstanding we estimated the premium to the freeholder to extend the lease to be within £18,100 and £20,800 exclusive of legals.