For anyone whose Hartfield flat is held on a long lease, the message is clear – if no remedial action is taken, your property will eventually revert to the freeholder, leaving you empty-handed. The fewer the years remaining the less it is worth and the more it will cost to extend the lease.
It is generally considered that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an additional 90 years added to any lease with more than 35 years left, the premises will be equivalent in value to a freehold for many years ahead.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a freeholder in Hartfield,the lease extension lawyers that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Hartfield valuers.
Subsequent to protracted discussions with the landlord of her garden flat in Hartfield, Chelsea started the lease extension process as the eighty year threshold was swiftly advancing. The transaction was finalised in August 2014. The freeholder’s charges were restricted to slightly above 700 pounds.
In 2010 we were contacted by Dr V Allen who, having took over the lease of a purpose-built flat in Hartfield in February 1995. The dilemma was if we could shed any light on how much (approximately) price would likely be to prolong the lease by ninety years. Identical homes in Hartfield with a long lease were in the region of £186,000. The average amount of ground rent was £65 billed annually. The lease finished in 2083. Taking into account 58 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £24,700 and £28,600 exclusive of professional charges.
In 2014 we were approached by Dr Joseph Anderson who, having took over the lease of a purpose-built apartment in Hartfield in February 1999. We are asked if we could approximate the compensation to the landlord would be for a 90 year lease extension. Identical properties in Hartfield with 100 year plus lease were worth £250,000. The mid-range amount of ground rent was £50 collected quarterly. The lease lapsed on 2 February 2094. Having 69 years as a residual term we approximated the premium to the landlord for the lease extension to be within £9,500 and £11,000 plus fees.