Harold Wood leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of the lease gets more expensive. The majority of owners of residential leasehold property in Harold Wood enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Harold Wood you should check if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under eighty years, the amount payable for any lease extension increases dramatically as part of the premium you pay is what is known as a marriage value
It is generally accepted that a residential leasehold with over one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 45 years left, the premises will be worth the same as 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. |
| 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
The lawyers that we work with procure Harold Wood 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.
In 2014 Liam, started to get close to the 80-year mark with the lease on his studio apartment in Harold Wood. In buying his flat 18 years ago, the length of the lease was of no relevance. As luck would have it, he recognised he needed to take steps soon on Extending the lease. Liam was able to extend his lease just under the wire in July. Liam and the freeholder eventually agreed on an amount of £6,000 . If the lease had gone to less than eighty years, the amount would have become more costly by at least £1,050.
Mr Arthur Rogers completed a one bedroom apartment in Harold Wood in April 2007. We are asked if we could estimate the compensation to the landlord would be for a 90 year lease extension. Similar residencies in Harold Wood with an extended lease were valued about £250,000. The mid-range ground rent payable was £50 collected every twelve months. The lease lapsed in 2093. Considering the 68 years outstanding we approximated the compensation to the freeholder for the lease extension to be within £9,500 and £11,000 plus costs.
An example of a Lease Extension case for a Harold Wood property is 37 Lodge Court High Street in November 2013. the decision of the LVT was that the premium to be paid for the new lease was £25,559 This case was in relation to 1 flat. The unexpired residue of the current lease was 57.5 years.