The re-sale value of a leasehold property in Hawkshead is impacted by how many years the lease has remaining. If it is near to or less than 80 years you should expect difficulties on re-sale, so it is advisable to arrange for a lease extension before buying. Ideally one should start the process of extending the lease is when a lease still has 82 years to run so that a lease extension can be finalised well before the eighty year mark. Current legislation entitles Hawkshead qualifying lessees to an additional term of ninety years on top of the remaining term, at a peppercorn rent (zero ground rent). The purpose of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is generally accepted that a property with more than one hundred years remaining is worth approximately the same as a freehold. Where an additional 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 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. |
| 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. |
| Godiva Mortgages | 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
The lawyers that we work with undertake Hawkshead 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 lawyer we work with provide it.
In 2014 Luca, came seriously close to the 80-year threshold with the lease on his garden apartment in Hawkshead. In buying his property two decades ago, the length of the lease was of minimal interest. Luckily, he noticed he needed to take steps soon on a lease extension. Luca was able to extend his lease just under the wire last April. Luca and the freeholder via the managing agents subsequently settled on the final figure of £6,000 . If he had missed the deadline, the price would have become more exhorbitant by a minimum £925.
Last month we were called by Mr and Mrs. S Michel , who moved into a basement flat in Hawkshead in September 1996. The question was if we could approximate the price would likely be to prolong the lease by a further 90 years. Identical properties in Hawkshead with a long lease were valued around £275,000. The average amount of ground rent was £55 collected quarterly. The lease lapsed in 2102. Taking into account 77 years left we approximated the premium to the freeholder to extend the lease to be between £13,300 and £15,400 not including fees.
Mr and Mrs. F Williams took over the lease of a first floor apartment in Hawkshead in April 1997. The question was if we could shed any light on how much (approximately) price would likely be for a ninety year extension to my lease. Comparable homes in Hawkshead with an extended lease were in the region of £183,600. The mid-range amount of ground rent was £65 invoiced every twelve months. The lease ended in 2082. Given that there were 57 years as a residual term we approximated the compensation to the freeholder to extend the lease to be between £28,500 and £33,000 plus fees.