It’s a harsh certainty that a Haslington residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Haslington property prices.Where your lease has approximately ninety years left, you should start considering 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 slips lower than 80 years - otherwise a higher amount will be due. Most flat owners in Haslington will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify if you are eligibility. In some cases you may not qualify. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor throughout the process.
It is generally considered that a property with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to any lease with more than 45 years remaining, the property will be equivalent in value to a freehold for many years in the future.
| 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; |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Using our service gives you enhanced control over the value of your Haslington leasehold, as your property will be more valuable and marketable in relation to the lease length should you wish to sell. The lawyers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
In recent months Hunter, started to get near to the 80-year mark with the lease on his ground floor apartment in Haslington. In buying his home two decades ago, the lease term was of minimal bearing. Thankfully, he noticed he would soon be paying an inflated amount for Extending the lease. Hunter arranged for a lease extension just under the wire in September. Hunter and the freeholder via the management company in the end settled on an amount of £6,000 . If he failed to meet the deadline, the amount would have gone up by at least £1,125.
Last Autumn we were called by Mr George Norbert , who was assigned a lease of a basement apartment in Haslington in August 2000. We are asked if we could approximate the price would be for a ninety year extension to my lease. Comparable properties in Haslington with an extended lease were worth £171,800. The average amount of ground rent was £55 collected quarterly. The lease finished in 2075. Given that there were 50 years as a residual term we approximated the compensation to the freeholder for the lease extension to be within £33,300 and £38,400 plus fees.
Mr Jack Bell was assigned a lease of a newly refurbished apartment in Haslington in September 1997. The dilemma was if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Identical flats in Haslington with an extended lease were valued around £280,000. The mid-range amount of ground rent was £45 invoiced annually. The lease elapsed in 2095. Taking into account 70 years left we calculated the compensation to the landlord for the lease extension to be within £12,400 and £14,200 not including costs.