For those whose Hackney property is held on a long lease, the message is clear – if nothing is done, the property will eventually revert to your landlord, leaving you empty-handed. The shorter the lease the lower the value of the property and the more it will cost to extend the lease.
It is generally accepted that a residential leasehold with in excess of 100 years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Leeds Building Society | 85 years remaining from the start 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. |
| 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 Hackney can be a difficult process. We recommend you procure professional help from a conveyancer and valuer well versed in the legislation and lease extension process.
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 a wealth of experience dealing with Hackney lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Trailing lengthy discussions with the landlord of her ground floor apartment in Hackney, Robyn commenced the lease extension process just as her lease was nearing the critical eighty-year mark. The legal work completed in February 2006. The landlord’s costs were restricted to about 450 GBP.
Mr K Moreau moved into a first floor apartment in Hackney in March 1995. We are asked if we could estimate the price would be to prolong the lease by an additional years. Comparable flats in Hackney with an extended lease were valued around £300,000. The average amount of ground rent was £50 invoiced quarterly. The lease ended in 2101. Considering the 75 years unexpired we approximated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 not including fees.
An example of a Freehold Enfranchisement matter before the tribunal 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 was in relation to 4 flats. The unexpired lease term was 90 (or thereabouts).