Unfortunately that a Hampden Pk residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the early years due to the reduction being disguised by increases in the Hampden Pk property market.Where your lease has approximately ninety years left, you need to start thinking about a lease extension. If lease term drops below 80 years, you will then be required to pay 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. The marriage fee is the amount of extra value that a lease extension will add the property The majority of flat owners in Hampden Pk will be able to extend under the legislation; however a conveyancer will be able to confirm whether you are eligibility. In some situations you may not qualify. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the process.
It is generally considered that a residential leasehold with over 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 35 years left, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
| 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. |
The conveyancing solicitors that we work with undertake Hampden Pk 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 lawyer we work with provide it.
Last Spring Austin, came critically close to the eighty-year mark with the lease on his leasehold flat in Hampden Pk. In buying his property 19 years previously, the unexpired term was of little interest. by good luck, he noticed he would soon be paying an escalated premium for a lease extension. Austin arranged for a lease extension just under the wire in May. Austin and the landlord subsequently settled on an amount of £5,000 . If the lease had gone below eighty years, the amount would have increased by at least £900.
Last Spring we were e-mailed by Mr Dexter Cook , who purchased a garden flat in Hampden Pk in June 2005. We are asked if we could approximate the premium would likely be to prolong the lease by ninety years. Similar properties in Hampden Pk with an extended lease were worth £300,000. The average amount of ground rent was £50 billed quarterly. The lease concluded in 2101. Considering the 76 years outstanding we calculated the premium to the freeholder for the lease extension to be between £8,600 and £9,800 not including fees.
In 2012 we were contacted by Dr Courtney Bailey who, having completed a first floor flat in Hampden Pk in July 1999. The dilemma was if we could approximate the compensation to the landlord would likely be to extend the lease by a further 90 years. Identical properties in Hampden Pk with an extended lease were worth £257,800. The average ground rent payable was £65 billed quarterly. The lease elapsed in 2090. Having 65 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £18,100 and £20,800 not including costs.