It’s an underpublicised certainty that a Hendon residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the reduction being disguised by increases in the Hendon property prices.Where your lease has approximately 90 years left, you need to start thinking about a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips lower than 80 years - otherwise a higher amount will be payable. The majority of leasehold owners in Hendon will be able to extend under the legislation; however a conveyancer should be able to clarify if you are eligibility. In some cases you may not qualify. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancer for the duration of the process.
It is generally accepted that a residential leasehold with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an additional 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 |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| 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. |
| 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. |
Engaging our service gives you enhanced control over the value of your Hendon leasehold, as your property will be more valuable and marketable in terms of lease length should you wish to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
After protracted negotiations with the freeholder of her first floor flat in Hendon, Molly commenced the lease extension process just as her lease was coming close to the crucial 80-year mark. The legal work was concluded in May 2010. The landlord’s charges were negotiated to a tad over 550 GBP.
Last Spring we were contacted by Mr and Mrs. C Brooks , who moved into a newly refurbished apartment in Hendon in March 2004. The question was if we could approximate the compensation to the landlord would likely be for a ninety year extension to my lease. Similar premises in Hendon with 100 year plus lease were valued about £280,000. The average ground rent payable was £45 billed per annum. The lease ended in 2096. Given that there were 70 years unexpired we approximated the compensation to the landlord to extend the lease to be between £12,400 and £14,200 exclusive of expenses.
An example of a Lease Extension case for a Hendon flat is First Floor Flat 61 Wilberforce Road in March 2014. The premium payable was £10,130 and the case was remitted back to the Willesden County Court to effect the Vesting Order (Claim No 3W103100). This case was in relation to 1 flat. The unexpired residue of the current lease was 71 years.