The value of Hornsey Rise leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can increase substantially once the remaining term is below than eighty years
Leasehold residencies in Hornsey Rise with more than 100 years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges warrant 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | 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. |
Retaining our service gives you increased control over the value of your Hornsey Rise leasehold, as your property will be more valuable and saleable in relation to the lease length should you wish to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Archie owned a studio apartment in Hornsey Rise being marketed with a lease of a little over 61 years outstanding. Archie informally contacted his landlord being a well known Manchester-based freehold company for a lease extension. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent initially set at £200 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Archie to exercise his statutory right. Archie procured expert legal guidance and was able to make an informed decision and handle with the matter and readily saleable.
In 2012 we were contacted by Ms Chelsea Roux who, having was assigned a lease of a studio flat in Hornsey Rise in September 2002. We are asked if we could estimate the price would be for a 90 year lease extension. Similar flats in Hornsey Rise with a long lease were valued around £300,000. The mid-range ground rent payable was £50 collected every twelve months. The lease lapsed in 2101. Having 75 years outstanding we calculated the premium to the freeholder for the lease extension to be within £8,600 and £9,800 exclusive of fees.
An example of a Freehold Enfranchisement case for a Hornsey Rise premises is 51 Lorne Road in November 2009. The price Payable as decided by the tribunal for the freehold reversion was £27,000. The valuation follows the order of the County Court made on 3 April 2008 granting a vesting order. This case related to 1 flat. The unexpired lease term was 71 years.