Unfortunately that a Hanworth residential lease is a wasting asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Hanworth property market.Where your lease has approximately ninety years left, you should start considering a lease extension. If the number of years remaining falls below 80 years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property The majority of flat owners in Hanworth will be able to extend under the legislation; however a lawyer should be able to clarify if you are eligibility. In some cases you may not be entitled. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the process.
Leasehold properties in Hanworth with over 100 years remaining on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and estate charges warrant it.
| Lender | Requirement |
|---|---|
| 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. |
| 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 Hanworth,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 Hanworth valuers.
Half a year ago Kai, started to get close to the 80-year mark with the lease on his studio apartment in Hanworth. In buying his property two decades ago, the unexpired term was of no significance. As luck would have it, he realised he would soon be paying way over the odds for a lease extension. Kai was able to extend his lease just in the nick of time in May. Kai and the freeholder eventually agreed on an amount of £5,500 . If he failed to meet the deadline, the amount would have escalated by at least £1,100.
Last Christmas we were e-mailed by Dr Toby Brown , who completed a one bedroom flat in Hanworth in August 2001. The question was if we could shed any light on how much (approximately) compensation to the landlord would likely be for a 90 year extension to my lease. Comparative homes in Hanworth with 100 year plus lease were in the region of £295,000. The mid-range ground rent payable was £45 invoiced per annum. The lease concluded on 26 February 2100. Taking into account 74 years outstanding we calculated the compensation to the landlord for the lease extension to be within £8,600 and £9,800 not including legals.
An example of a Lease Extension matter before the tribunal for a Hanworth premises 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.