On the balance of probabilities if you own a flat in Havering you actually own a long leasehold interest over your property
It is generally considered that a residential leasehold with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the property will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The conveyancers that we work with procure Havering 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.
Off the back of lengthy discussions with the landlord of her garden flat in Havering, Melissa started the lease extension process as the 80 year mark was quickly approaching. The lease extension was finalised in July 2007. The freeholder’s costs were kept to an absolute minimum.
Mr and Mrs. V Dupont took over the lease of a ground floor apartment in Havering in August 2005. The dilemma was if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Similar homes in Havering with a long lease were valued about £198,800. The average ground rent payable was £55 collected every twelve months. The lease terminated in 2081. Having 55 years outstanding we approximated the compensation to the landlord for the lease extension to be between £33,300 and £38,400 plus fees.
An example of a Lease Extension decision for a Havering residence 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 related to 1 flat. The unexpired term as at the valuation date was 57.5 years.