The re-sale value of a leasehold property in Hemel Hempstead depends on how many years the lease has remaining. If it is close to or fewer than 80 years you should anticipate problems on re-sale, so it is advisable to arrange for the lease to be extended ahead of purchasing. It is preferable to commence the lease extension process when the lease still has 82 years to run so that a lease extension can be addressed prior to the 80 year cut off point. Leasehold Reform legislation entitles Hemel Hempstead qualifying lessees to obtain a lease extension of ninety years in addition to the remaining lease term at a peppercorn rent (that is, rent free). The reason of the valuation is to arrive at an opinion of the premium payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold premises in Hemel Hempstead with more than 100 years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in buying the freehold unless savings on ground rent and maintenance charges warrant it.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Yorkshire 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. |
Retaining our service gives you enhanced control over the value of your Hemel Hempstead leasehold, as your property will be more valuable and marketable in respect of lease length should you decide to sell. The conveyancing solicitors that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Trailing protracted discussions with the landlord of her purpose-built flat in Hemel Hempstead, Chloe initiated the lease extension process just as the lease was coming close to the all-important 80-year mark. The lease extension was finalised in February 2005. The freeholder’s costs were restricted to about four hundred pounds.
In 2013 we were approached by Mr and Mrs. C Khan who, having bought a first floor flat in Hemel Hempstead in March 2006. The dilemma was if we could approximate the price would be to extend the lease by an additional years. Identical residencies in Hemel Hempstead with a long lease were valued around £260,000. The mid-range amount of ground rent was £50 collected annually. The lease ran out in 2098. Taking into account 72 years outstanding we estimated the premium to the freeholder for the lease extension to be between £9,500 and £11,000 plus legals.
Mr and Mrs. T Morris purchased a ground floor flat in Hemel Hempstead in October 1998. The dilemma was if we could shed any light on how much (approximately) price could be to extend the lease by 90 years. Comparative flats in Hemel Hempstead with 100 year plus lease were in the region of £256,600. The average amount of ground rent was £60 collected annually. The lease elapsed on 26 September 2078. Considering the 52 years left we approximated the compensation to the landlord to extend the lease to be within £39,000 and £45,000 plus professional charges.