Heath Hayes leases on residential properties are gradually losing value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of the lease gets more expensive. Most owners of residential leasehold property in Heath Hayes enjoy rights under legislation to extend the terms of their leases. Where you are a leasehold owner in Heath Hayes you would be well advised to check if your lease has between seventy and ninety years left. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension increases dramatically as part of the premium you will incur is what is known as a marriage value
Leasehold premises in Heath Hayes with more than one hundred years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such circumstances there is often little upside in buying the freehold unless savings on ground rent and service charges justify it.
| 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Using our service will provide you increased control over the value of your Heath Hayes leasehold, as your property will be more valuable and marketable in respect of lease length should you want to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Off the back of unsuccessful correspondence with the landlord of her basement flat in Heath Hayes, Mollie commenced the lease extension process as the eighty year mark was fast coming. The transaction completed in March 2010. The landlord’s charges were negotiated to less than 550 pounds.
Last month we were contacted by Mr and Mrs. H Harris , who was assigned a lease of a one bedroom apartment in Heath Hayes in March 1999. We are asked if we could approximate the compensation to the landlord would be for a 90 year extension to my lease. Comparable homes in Heath Hayes with 100 year plus lease were valued around £260,200. The average amount of ground rent was £65 invoiced yearly. The lease elapsed in 2092. Considering the 66 years remaining we estimated the compensation to the landlord to extend the lease to be within £16,200 and £18,600 exclusive of fees.
Dr W Garcia took over the lease of a purpose-built apartment in Heath Hayes in June 2006. We are asked if we could shed any light on how much (roughly) premium would be for a 90 year extension to my lease. Identical properties in Heath Hayes with an extended lease were in the region of £198,800. The average amount of ground rent was £55 billed monthly. The lease ended in 2081. Given that there were 55 years outstanding we calculated the compensation to the landlord to extend the lease to be between £33,300 and £38,400 exclusive of professional charges.