It’s a harsh truth that a Hockley Heath residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the early years due to the deflation being disguised by increases in the Hockley Heath property market.Where your lease has approximately 90 years left, you should start considering 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 falls lower than eighty years - otherwise a higher amount will be payable. Most flat owners in Hockley Heath will be able to extend under the legislation; however a conveyancer should be able to clarify if you are eligibility. In some situations you may not be entitled. There are also strict timeframes and procedures to follow once the process is instigated and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
It is conventional wisdom that a property with in excess of 100 years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 30 years unexpired, the residence will be equivalent in value to a freehold for decades to come.
| 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Hockley Heath can be a difficult process. We recommend you obtain professional help from a lawyer and valuer with experience in this area.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have in-depth market knowledge procuring Hockley Heath lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Sebastian owned a conversion apartment in Hockley Heath on the market with a lease of fraction over 72 years unexpired. Sebastian informally approached his freeholder a well known Bristol-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of an increased rent to £200 per annum. Ordinarily, ground rent would not be payable on a lease extension were Sebastian to exercise his statutory right. Sebastian obtained expert legal guidance and secured satisfactory resolution informally and ending up with a market value flat.
Last Autumn we were phoned by Dr U Peterson , who owned a one bedroom apartment in Hockley Heath in September 2003. We are asked if we could shed any light on how much (approximately) price would be for a 90 year extension to my lease. Similar flats in Hockley Heath with an extended lease were worth £250,000. The mid-range amount of ground rent was £50 collected per annum. The lease elapsed in 2094. Taking into account 69 years outstanding we calculated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 plus fees.
Mr A Turner bought a studio apartment in Hockley Heath in April 2001. We are asked if we could estimate the price would be for a ninety year lease extension. Comparable properties in Hockley Heath with an extended lease were worth £285,000. The mid-range amount of ground rent was £55 billed quarterly. The lease ran out on 22 November 2105. Given that there were 80 years remaining we approximated the premium to the landlord to extend the lease to be between £12,400 and £14,200 exclusive of fees.