Chances are that if you own a flat in Hackney you actually own a long leasehold interest over your property
Leasehold properties in Hackney with in excess of one hundred years remaining on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges justify it.
| 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; |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Retaining our service gives you increased control over the value of your Hackney leasehold, as your property will be more valuable and marketable in relation to the lease length should you want to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Last October Rory, came very near to the eighty-year threshold with the lease on his first floor apartment in Hackney. Having bought his home 19 years ago, the unexpired term was of little interest. Thankfully, he realised he needed to take steps soon on Extending the lease. Rory was able to extend his lease just under the wire in March. Rory and the freeholder in the end settled on the final figure of £6,000 . If he not met the deadline, the amount would have escalated by a minimum £1,125.
Mr and Mrs. M Roberts purchased a ground floor apartment in Hackney in January 2012. We are asked if we could approximate the compensation to the landlord would likely be to extend the lease by a further 90 years. Comparative premises in Hackney with an extended lease were worth £230,800. The mid-range ground rent payable was £60 billed annually. The lease concluded in 2086. Having 60 years left we approximated the compensation to the landlord for the lease extension to be within £24,700 and £28,600 not including fees.
An example of a Freehold Enfranchisement case for a Hackney flat is 150 Amhurst Road in December 2013. The tribunal concluded that the premium to be paid by the applicant for the enfranchisement of the subject property was £43,500. This case related to 4 flats. The unexpired term was 90 (or thereabouts).