With a residential leasehold premises in Hemel Hempstead, you effectively rent it for a certain period of time. In recent years flat leases typically tend to be for 99 years or 125. Even though this may appear like a lengthy period of time, you should think about a lease extension sooner rather than later. The general rule is that the shorter the number of years is the cost of extending the lease gets disproportionately greater particularly once there are fewer than eighty years left. Anyone in Hemel Hempstead with a lease approaching 81 years remaining should seriously consider extending it without delay. When the lease term has less than eighty years left, under the current legislation the landlord can calculate and charge a greater premium, based on a technical multiplication, strangely termed as “marriage value” which is due.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 30 years left, the residence 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. |
| Bank of Scotland | 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. |
| 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. |
| 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 |
Regardless of whether you are a tenant or a freeholder in Hemel Hempstead,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Hemel Hempstead valuers.
Last year William, came seriously near to the 80-year threshold with the lease on his studio apartment in Hemel Hempstead. In buying his property two decades ago, the length of the lease was of minimal concern. Luckily, he noticed he would soon be paying way over the odds for Extending the lease. William arranged for a lease extension just ahead of time last April. William and the freeholder via the managing agents eventually agreed on a premium of £5,500 . If the lease had descended to less than 80 years, the price would have escalated by a minimum £900.
Last Autumn we were e-mailed by Mr Aarav Garcia , who took over the lease of a ground floor flat in Hemel Hempstead in October 2001. We are asked if we could estimate the premium could be for a ninety year extension to my lease. Similar premises in Hemel Hempstead with a long lease were in the region of £250,000. The mid-range ground rent payable was £50 collected quarterly. The lease expiry date was in 2094. Taking into account 69 years remaining we calculated the compensation to the freeholder for the lease extension to be within £9,500 and £11,000 plus costs.
Mr and Mrs. D Jones was assigned a lease of a purpose-built apartment in Hemel Hempstead in September 1999. We are asked if we could estimate the price could be to extend the lease by ninety years. Comparative homes in Hemel Hempstead with 100 year plus lease were worth £285,000. The average amount of ground rent was £55 billed annually. The lease expiry date was on 3 November 2105. Considering the 80 years as a residual term we calculated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 not including expenses.