It’s a harsh truth that a Holborn residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the deflation being disguised by increases in the Holborn property prices.Where your lease has approximately ninety years left, you need to 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 under 80 years - otherwise a higher amount will be due. The majority of leasehold owners in Holborn will be able to extend under the legislation; however a conveyancing solicitor should be able to clarify if you are eligibility. In some cases you may not be entitled. There are also strict timeframes and procedures to follow once the process is initiated and you will need to be guided by your lawyer throughout the process.
It is generally accepted that a residential leasehold with over one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional 90 years added to any lease with more than 35 years unexpired, the premises will be worth the same as 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. |
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 Holborn,the lease extension solicitors that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Holborn valuers.
Following protracted discussions with the landlord of her first floor flat in Holborn, Phoebe started the lease extension process as the eighty year mark was swiftly advancing. The legal work was concluded in July 2008. The freeholder’s charges were kept to an absolute minimum.
Last Summer we were called by Dr Henry Bell , who owned a one bedroom apartment in Holborn in October 2011. We are asked if we could shed any light on how much (approximately) price would be for a ninety year lease extension. Similar residencies in Holborn with an extended lease were worth £275,000. The average amount of ground rent was £65 billed yearly. The lease terminated in 2093. Having 68 years remaining we estimated the premium to the landlord to extend the lease to be between £13,300 and £15,400 plus professional charges.
An example of a Lease Extension matter before the tribunal for a Holborn premises is Flat 89 Trinity Court Grays Inn Road in February 2013. the Tribunal found that the premium to be paid by the tenant on the grant of a new lease, in accordance with section 56 and Schedule 13 to the Leasehold Reform, Housing and Urban Development Act 1993 should be £36,229. This case affected 1 flat. The remaining number of years on the lease was 66.8 years.