Hornsey leases on residential properties are gradually losing value. if your lease has about 90 years remaining, you should start considering the need for a lease extension. If lease term is less than 80 years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add to the property. Leasehold owners in Hornsey will usually be legally entitled to a lease extension; however a solicitor should be able confirm if you qualify. In some circumstances you may not qualify. There are also strict timetables and formalities to follow once the process has commenced so it’s best to be guided by a conveyancer during the process.
It is generally considered that a property with more than one hundred years remaining is worth roughly the equivalent as a freehold. Where an further ninety years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| 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. |
The lawyers that we work with undertake Hornsey 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 conveyancing solicitor we work with provide it.
During the course of the last few months Harry, started to get close to the 80-year mark with the lease on his first floor apartment in Hornsey. Having bought his home 18 years previously, the unexpired term was of little bearing. As luck would have it, he recognised he needed to take action soon on a lease extension. Harry was able to extend his lease at the eleventh hour in September. Harry and the freeholder via the managing agents in the end agreed on sum of £5,500 . If the lease had slid below 80 years, the amount would have increased by a minimum £1,025.
In 2013 we were phoned by Mrs P Lee who, having took over the lease of a garden apartment in Hornsey in September 2000. We are asked if we could shed any light on how much (approximately) premium would likely be for a ninety year lease extension. Comparable residencies in Hornsey with an extended lease were worth £173,800. The average ground rent payable was £60 billed annually. The lease came to a finish on 14 August 2080. Considering the 55 years unexpired we calculated the compensation to the landlord for the lease extension to be between £31,400 and £36,200 exclusive of fees.
An example of a Freehold Enfranchisement matter before the tribunal for a Hornsey flat is 7 Aubrey Road in December 2010. By an order of the county court on 15/12/2009 the freehold interest inthe Property known as 7 Aubrey Road London N8 9HH (the Property) and registered at HM Land Registry under title number MX439124 was vested in the applicants. The Tribunal calculated that the total enfranchisement premium, assessed in accordance with Schedule 6 to the Act, was £54,633. This case was in relation to 3 flats. The unexpired term as at the valuation date was 73.27 years.