It’s a harsh certainty that a Hartlepool residential lease is a deteriorating 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 reduction being disguised by increases in the Hartlepool property prices.Where your lease has approximately 90 years left, you should start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease falls below eighty years - otherwise a higher premium will be due. The majority of flat owners in Hartlepool will be able to extend under the legislation; however a conveyancer will be able to confirm if you are eligibility. In some cases you may not qualify. There are also strict deadlines and procedures to follow once the process has commenced and you will need to be guided by your lawyer throughout the formalities.
It is generally considered that a residential leasehold with in excess of 100 years unexpired lease term is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 45 years unexpired, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset of the mortgage. |
| 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 |
| 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. |
The lawyers that we work with procure Hartlepool 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.
Last year Jamie, started to get near to the eighty-year threshold with the lease on his one bedroom apartment in Hartlepool. Having purchased his flat two decades ago, the length of the lease was of no significance. Fortunately, he realised he would soon be paying way over the odds for Extending the lease. Jamie extended the lease just under the wire in January. Jamie and the freeholder in the end settled on the final figure of £6,000 . If the lease had dipped to less than 80 years, the premium would have increased by a minimum £900.
Last year we were called by Dr Natasha Mitchell , who bought a basement flat in Hartlepool in April 2009. The question was if we could estimate the compensation to the landlord would likely be to extend the lease by ninety years. Comparative flats in Hartlepool with 100 year plus lease were in the region of £300,000. The average ground rent payable was £50 collected quarterly. The lease terminated on 15 July 2102. Taking into account 76 years outstanding we calculated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 not including expenses.
Dr Courtney Mercier moved into a basement flat in Hartlepool in July 2011. We are asked if we could shed any light on how much (roughly) compensation to the landlord would be for a 90 year extension to my lease. Similar flats in Hartlepool with 100 year plus lease were in the region of £257,800. The mid-range ground rent payable was £65 billed every twelve months. The lease terminated in 2091. Taking into account 65 years outstanding we calculated the premium to the freeholder for the lease extension to be within £18,100 and £20,800 exclusive of fees.