For anyone whose Hale Barns flat is held on a long lease, our 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 procure a lease extension.
It is generally considered that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 45 years left, the residence 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. |
| Leeds Building Society | 85 years remaining from the start 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. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Hale Barns,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Hale Barns valuers.
After unsuccessful correspondence with the landlord of her one bedroom apartment in Hale Barns, Poppy initiated the lease extension process just as her lease was coming close to the all-important 80-year deadline. The transaction completed in March 2008. The landlord’s costs were restricted to approximately 550 pounds.
Last Autumn we were approach by Mrs L Cox , who was assigned a lease of a studio flat in Hale Barns in July 2001. We are asked if we could estimate the premium could be for a 90 year extension to my lease. Comparative premises in Hale Barns with a long lease were in the region of £280,000. The mid-range ground rent payable was £55 billed yearly. The lease expired on 6 August 2102. Taking into account 77 years unexpired we approximated the premium to the landlord to extend the lease to be within £13,300 and £15,400 plus professional charges.
Dr C Mason took over the lease of a studio flat in Hale Barns in August 2010. We are asked if we could estimate the premium could be for a 90 year extension to my lease. Comparable premises in Hale Barns with an extended lease were valued about £183,600. The average amount of ground rent was £65 billed yearly. The lease concluded in 2082. Considering the 57 years remaining we estimated the compensation to the freeholder to extend the lease to be within £28,500 and £33,000 plus expenses.