The re-sale value of a leasehold property in Hanworth depends on how long the lease has left to run. If it is close to or fewer than 80 years you should expect problems on re-sale, so it is recommended to arrange for a lease extension ahead of buying. It is preferable to start the process of extending the lease is when the lease still has 82 years remaining so that all matters can be finalised prior to the 80 year threshold. Statute enables Hanworth qualifying lessees to acquire a new lease which will be for the current unexpired lease term plus an additional term of ninety years. The purpose of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the purchase of the lease extension.
It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 45 years unexpired, the premises will be worth the same as a freehold for many years in the future.
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with undertake Hanworth 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.
Off the back of unsuccessful negotiations with the freeholder of her ground floor flat in Hanworth, Isabelle initiated the lease extension process just as the lease was coming close to the crucial eighty-year deadline. The legal work completed in April 2005. The freeholder’s fees were restricted to below 600 GBP.
Last July we were phoned by Mr Jasper Dupont , who bought a basement apartment in Hanworth in July 2007. The dilemma was if we could shed any light on how much (roughly) premium could be for a 90 year lease extension. Similar premises in Hanworth with a long lease were valued about £233,200. The average ground rent payable was £60 invoiced monthly. The lease ran out on 9 October 2086. Having 61 years as a residual term we calculated the premium to the freeholder to extend the lease to be between £22,800 and £26,400 exclusive of legals.
An example of a Lease Extension decision for a Hanworth property is 147 Redford Close in June 2012. The Tribunal determined the lease extension premium to be at £4,200 This case affected 1 flat. The remaining number of years on the lease was 82.93 years.