Henlow leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and accordingly any extension of your lease becomes more expensive. Legislation has been in place for sometime now allowing qualifying Henlow residential leaseholders to extend the terms of long leases. Where you are a leasehold owner in Henlow you should see if your lease has between seventy and 90 years left. In particular once the remaining lease term slips under 80 years, the amount payable for any lease extension increases dramatically as an element of the premium you will incur is what is known as a marriage value
It is generally considered that a property 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 residence will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Henlow,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Henlow valuers.
16 months ago Tyler, came critically near to the eighty-year threshold with the lease on his ground floor apartment in Henlow. Having purchased his home 19 years previously, the unexpired term was of little bearing. As luck would have it, he recognised he would imminently be paying an inflated amount for Extending the lease. Tyler extended the lease just under the wire last April. Tyler and the landlord in the end settled on a premium of £6,000 . If the lease had fallen below eighty years, the price would have become more exhorbitant by a minimum £850.
In 2010 we were called by Mr and Mrs. F Vincent who, having took over the lease of a first floor apartment in Henlow in July 2006. The question was if we could estimate the premium could be for a ninety year extension to my lease. Comparable residencies in Henlow with a long lease were in the region of £250,400. The average amount of ground rent was £65 collected yearly. The lease expired on 9 March 2089. Taking into account 64 years unexpired we approximated the premium to the landlord to extend the lease to be between £19,000 and £22,000 not including expenses.
Dr Katherine Mitchell completed a newly refurbished apartment in Henlow in January 1995. The question was if we could estimate the compensation to the landlord would be for a ninety year lease extension. Similar premises in Henlow with 100 year plus lease were worth £189,000. The average amount of ground rent was £55 invoiced every twelve months. The lease elapsed in 2078. Given that there were 53 years outstanding we calculated the premium to the landlord for the lease extension to be within £28,500 and £33,000 exclusive of professional charges.