The re-sale value of a leasehold property in Higham Wood is impacted by how many years the lease has left to run. If it is near to or fewer than 80 years you should envisage problems on re-sale, so it is recommended to arrange for the lease to be extended prior to buying. It is preferable to start the lease extension process when a lease still has 82 years remaining so that formalities can be addressed well before the eighty year cut off point. Statute entitles Higham Wood qualifying lessees to acquire a new lease which will be for the current unexpired lease term plus a further term of 90 years. The purpose of the valuation is to determine the sum payable by the lessee to the freeholder for the acquisition of the lease extension.
It is generally accepted that a residential leasehold with over 100 years unexpired lease term is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 35 years left, the property 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. |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
The conveyancers that we work with handle Higham Wood 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 conveyancer we work with provide it.
Jamie owned a conversion apartment in Higham Wood being marketed with a lease of just over 72 years outstanding. Jamie on an informal basis approached his freeholder a well known local-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years subject to an increased rent to £125 annually. No ground rent would be payable on a lease extension were Jamie to exercise his statutory right. Jamie procured expert advice and secured an acceptable resolution without going to tribunal and sell the property.
Last Spring we were called by Dr M Stewart , who was assigned a lease of a garden flat in Higham Wood in October 2006. We are asked if we could shed any light on how much (roughly) premium would likely be to prolong the lease by 90 years. Identical residencies in Higham Wood with 100 year plus lease were in the region of £280,000. The mid-range amount of ground rent was £55 billed every twelve months. The lease end date was in 2104. Given that there were 78 years remaining we estimated the compensation to the freeholder to extend the lease to be within £13,300 and £15,400 plus fees.
In 2014 we were approached by Mrs P Torres who, having was assigned a lease of a first floor apartment in Higham Wood in August 2001. The question was if we could estimate the price could be for a ninety year extension to my lease. Comparative flats in Higham Wood with 100 year plus lease were worth £191,000. The average ground rent payable was £65 invoiced monthly. The lease ended in 2084. Considering the 58 years remaining we calculated the premium to the freeholder to extend the lease to be between £23,800 and £27,400 plus professional charges.