It’s an underpublicised certainty that a Hope residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Hope property prices.Once your lease nears 85ish years, you should start thinking about a lease extension. If the number of years remaining falls below 80 years, you will then be required to pay 50% of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of leasehold owners in Hope will be able to extend under the legislation; however a conveyancing solicitor should be able to confirm whether you are eligibility. In some cases you may not qualify. There are also strict timeframes and procedures to be adhered to once the process is instigated and you will need to be guided by your conveyancer throughout the process.
Leasehold residencies in Hope with in excess of 100 years outstanding on the lease are often regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and service charges merit it.
| 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 are not acceptable. 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
Lease extensions in Hope can be a difficult process. We recommend you secure guidance from a lawyer and valuer with experience in lease extensions.
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 dealing with Hope lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Theo was the the leasehold owner of a high value flat in Hope being marketed with a lease of fraction over fifty eight years left. Theo informally contacted his landlord a well known London-based freehold company for a lease extension. The freeholder indicated a willingness to grant an extension taking the lease to 125 years on the basis of a new rent at the outset set at £200 per annum and increase every 25 years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Theo to exercise his statutory right. Theo procured expert legal guidance and was able to make an informed judgement and deal with the matter and readily saleable.
Last Summer we were approach by Mr Daniel Parker , who purchased a basement apartment in Hope in August 1996. We are asked if we could estimate the compensation to the landlord could be to prolong the lease by a further 90 years. Identical properties in Hope with an extended lease were in the region of £193,400. The average ground rent payable was £65 invoiced quarterly. The lease elapsed in 2085. Taking into account 59 years unexpired we calculated the premium to the landlord for the lease extension to be between £21,900 and £25,200 exclusive of expenses.
Mrs V James was assigned a lease of a ground floor flat in Hope in October 2001. We are asked if we could approximate the price could be for a ninety year lease extension. Similar flats in Hope with an extended lease were worth £255,000. The average amount of ground rent was £50 collected every twelve months. The lease expiry date was on 13 August 2096. Given that there were 70 years unexpired we estimated the premium to the freeholder for the lease extension to be within £10,500 and £12,000 not including expenses.