The market value of a leasehold property in Harmondsworth depends on how long the lease has left to run. If it is close to or fewer than 80 years you should expect difficulties on re-sale, so it is advisable to arrange for the lease to be extended ahead of purchasing. It is preferable to start the lease extension process when a lease still has 82 years to run so that formalities can be concluded ahead of the 80 year mark. Leasehold Reform legislation enables Harmondsworth qualifying lessees to acquire a lease extension of ninety years in addition to the remaining lease term at a peppercorn rent (that is, rent free). The intention of the valuation is to determine the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
It is generally considered that a property with more than one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 procure Harmondsworth 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 conveyancing solicitor we work with provide it.
Last October David, started to get close to the eighty-year mark with the lease on his two bedroom flat in Harmondsworth. In buying his property 18 years previously, the lease term was of no relevance. As luck would have it, he recognised he would soon be paying way over the odds for a lease extension. David arranged for a lease extension just under the wire in June. David and the freeholder eventually settled on sum of £6,000 . If he not met the deadline, the sum would have gone up by a minimum £850.
In 2011 we were contacted by Mr H Adams who, having purchased a one bedroom flat in Harmondsworth in November 2001. The question was if we could approximate the compensation to the landlord would likely be to extend the lease by 90 years. Similar properties in Harmondsworth with 100 year plus lease were in the region of £184,000. The mid-range amount of ground rent was £55 billed annually. The lease lapsed on 15 April 2078. Given that there were 53 years left we calculated the compensation to the landlord for the lease extension to be within £28,500 and £33,000 not including costs.
An example of a Freehold Enfranchisement decision for a Harmondsworth premises is 164 Nestles Avenue in October 2013. The tribunal agreed with the proposed price of £20,158 for the freehold and determined that that sum is the amount to be paid into court This case related to 2 flats. The unexpired lease term was 69 years.