The re-sale value of a leasehold property in Hadley Wood depends on how many years the lease has left to run. If it is near to or fewer than eighty years you should foresee difficulties on re-sale, so it is recommended to arrange for a lease extension before purchasing. It is preferable to start the process of extending the lease is when a lease still has 82 years unexpired so that all matters can be finalised in advance of the eighty year mark. Current legislation enables Hadley Wood qualifying lessees to acquire a lease extension of 90 years on top of the remaining length of the lease at a peppercorn rent (that is, rent free). The intention of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is generally accepted that a property with in excess of one hundred years remaining is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be worth the same as a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Chelsea 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancing solicitors that we work with undertake Hadley Wood 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.
Austin owned a 2 bedroom flat in Hadley Wood being marketed with a lease of a few days over sixty years left. Austin on an informal basis contacted his freeholder a well known Manchester-based freehold company and enquired on a premium to extend the lease. The freeholder was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £100 per annum and doubled every 25 years thereafter. No ground rent would be payable on a lease extension were Austin to exercise his statutory right. Austin obtained expert legal guidance and secured an acceptable deal informally and ending up with a market value flat.
Mr Seth Williams acquired a garden apartment in Hadley Wood in November 1996. The question was if we could shed any light on how much (approximately) price would be to prolong the lease by ninety years. Comparable flats in Hadley Wood with an extended lease were in the region of £191,000. The average amount of ground rent was £65 invoiced yearly. The lease finished in 2083. Considering the 58 years unexpired we calculated the premium to the landlord for the lease extension to be within £23,800 and £27,400 exclusive of professional charges.
An example of a Lease Extension decision for a Hadley Wood premises is Flat 2 2 Netherfield Road in April 2010. The Tribunale held that premium payable for a 90 year extension to the existing Lease should be £7,705. This case affected 1 flat. The number of years remaining on the existing lease(s) was 76 years.