It’s an underpublicised certainty that a Hockley Heath residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the deflation being disguised by increases in the Hockley Heath property market.Once your lease gets to 85ish years, you need to start considering a lease extension. If lease term drops under 80 years, you will then be required to pay 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property Most flat owners in Hockley Heath will be able to extend under the legislation; however a lawyer 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 is initiated and you will need to be guided by your conveyancer for the duration of the process.
It is conventional wisdom that a residential leasehold with over one hundred years remaining is worth approximately the same as a freehold. Where an further ninety years added to any lease with more than 35 years remaining, the property will be worth the same as 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. |
| 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. |
| Godiva Mortgages | 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. |
| 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. |
The conveyancers that we work with procure Hockley Heath 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.
After unsuccessful discussions with the landlord of her first floor flat in Hockley Heath, Jasmine started the lease extension process just as the lease was nearing the crucial 80-year threshold. The transaction was finalised in August 2011. The freeholder’s charges were negotiated to less than 650 GBP.
Dr E François completed a newly refurbished flat in Hockley Heath in June 2005. The dilemma was if we could approximate the compensation to the landlord could be for a 90 year extension to my lease. Identical flats in Hockley Heath with 100 year plus lease were worth £200,800. The mid-range amount of ground rent was £65 collected monthly. The lease expired on 4 October 2086. Given that there were 60 years left we calculated the premium to the freeholder for the lease extension to be within £20,900 and £24,200 not including professional charges.
Last Summer we were called by Ms H Baker , who completed a purpose-built apartment in Hockley Heath in September 2002. We are asked if we could approximate the compensation to the landlord would be to extend the lease by 90 years. Identical properties in Hockley Heath with an extended lease were in the region of £255,000. The average amount of ground rent was £50 invoiced yearly. The lease termination date was in 2097. Given that there were 71 years outstanding we approximated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 plus legals.