The market value of a leasehold property in Howden is impacted by how long the lease has remaining. If it is near to or less than 80 years you should envisage problems on re-sale, so it is advisable to arrange for the lease to be extended before purchasing. It is ideal to start the lease extension process when the lease still has 82 years to run so that formalities can be finalised prior to the 80 year cut off point. Leasehold Reform legislation enables Howden qualifying lessees to acquire a lease extension of 90 years on top of the remaining length of the lease at a peppercorn rent (that is, rent free). The reason of the valuation is to determine the amount payable by the lessee to the freeholder for the purchase of the lease extension.
It is generally considered that a residential leasehold with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 35 years remaining, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Birmingham Midshires | |
| National Westminster Bank | |
| Skipton Building Society | |
| Royal Bank of Scotland | |
| Virgin |
The conveyancing solicitors that we work with undertake Howden 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.
Half a year ago Gabriel, came dangerously near to the eighty-year threshold with the lease on his basement flat in Howden. In buying his home two decades ago, the length of the lease was of minimal concern. Fortunately, he realised he needed to take action soon on Extending the lease. Gabriel was able to extend his lease just in the nick of time in June. Gabriel and the landlord who owned the flat above ultimately settled on a premium of £5,000 . If he not met the deadline, the price would have become more exhorbitant by at least £1,075.
Mrs O Turner purchased a garden flat in Howden in March 2007. We are asked if we could approximate the price would likely be to extend the lease by 90 years. Comparative premises in Howden with an extended lease were valued about £264,000. The average ground rent payable was £60 collected quarterly. The lease ended on 16 October 2079. Considering the 53 years as a residual term we estimated the premium to the freeholder to extend the lease to be between £37,100 and £42,800 plus professional charges.
In 2012 we were phoned by Mrs Olivia Leroy who, having owned a one bedroom apartment in Howden in November 2006. We are asked if we could shed any light on how much (approximately) premium could be for a 90 year lease extension. Comparative flats in Howden with 100 year plus lease were in the region of £225,400. The average amount of ground rent was £45 billed yearly. The lease finished on 21 November 2090. Having 64 years remaining we approximated the premium to the freeholder to extend the lease to be between £15,200 and £17,600 exclusive of expenses.