The re-sale value of a leasehold property in Harrow is impacted by how long the lease has left to run. If it is close to or fewer than eighty years you should foresee difficulties on re-sale, so it is advisable to arrange for the lease to be extended prior to buying. It is preferable to commence the process of extending the lease is when the lease still has 82 years unexpired so that a lease extension can be addressed in advance of the 80 year cut off point. Statute enables Harrow qualifying lessees to an additional term of ninety years over and above the existing term, at a nominal rent (zero ground rent). The reason of the valuation is to determine the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold properties in Harrow with over one hundred years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such circumstances there is often little to be gained by buying the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Coventry Building Society | 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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 lawyers that we work with procure Harrow 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.
Off the back of lengthy correspondence with the freeholder of her one bedroom flat in Harrow, Stephanie initiated the lease extension process just as her lease was approaching the critical eighty-year threshold. The transaction was finalised in May 2006. The landlord’s charges were kept to an absolute minimum.
Mr and Mrs. D Roberts was assigned a lease of a ground floor apartment in Harrow in September 2001. We are asked if we could estimate the price would likely be for a 90 year lease extension. Comparative properties in Harrow with an extended lease were in the region of £300,000. The mid-range amount of ground rent was £50 billed quarterly. The lease ended in 2101. Having 76 years left we approximated the premium to the landlord for the lease extension to be within £8,600 and £9,800 plus fees.
An example of a Lease Extension matter before the tribunal for a Harrow premises is flat 93b Welldon Crescent in May 2009. The Tribunals valuation for a 90-year lease extension of this fat was £13,171 This case affected 1 flat. The unexpired term was 75.25 years.