The market value of a leasehold property in Henlow depends on how long the lease has remaining. If it is close to or fewer than 80 years you should expect difficulties on re-sale, so it is recommended to arrange for a lease extension ahead of purchasing. It is preferable to start the lease extension process when a lease still has 82 years remaining so that a lease extension can be addressed prior to the 80 year cut off point. Leasehold Reform legislation entitles Henlow qualifying lessees to obtain a lease extension of ninety years on top of the remaining lease term at a peppercorn rent (that is, rent free). The reason of the valuation is to determine the sum payable by the lessee to the freeholder for the purchase of the lease extension.
Leasehold premises in Henlow with over 100 years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The conveyancers that we work with procure Henlow lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancing solicitor we work with provide it.
Subsequent to protracted discussions with the freeholder of her garden apartment in Henlow, Samantha commenced the lease extension process as the eighty year threshold was rapidly nearing. The legal work was concluded in August 2005. The landlord’s fees were negotiated to approximately 600 GBP.
In 2010 we were phoned by Mr Leo Cooper who, having bought a ground floor apartment in Henlow in October 1998. The question was if we could estimate the compensation to the landlord would be to extend the lease by an additional years. Comparative premises in Henlow with 100 year plus lease were worth £210,000. The average amount of ground rent was £50 collected quarterly. The lease came to a finish in 2105. Considering the 80 years left we calculated the premium to the freeholder to extend the lease to be within £8,600 and £9,800 not including costs.
In 2013 we were approached by Mr and Mrs. P Thompson who, having was assigned a lease of a ground floor flat in Henlow in July 1998. We are asked if we could estimate the compensation to the landlord would likely be to extend the lease by an additional years. Similar properties in Henlow with a long lease were in the region of £280,000. The mid-range ground rent payable was £45 collected monthly. The lease terminated in 2094. Considering the 69 years remaining we approximated the compensation to the freeholder to extend the lease to be between £12,400 and £14,200 exclusive of costs.