With a long leasehold premises in Hyde Park, you effectively rent it for a certain amount of time. In recent years flat leases are usually granted for 99 years or 125. Many leasehold owners become complacent as this seems like a long period of time, you should consider extending the lease sooner rather than later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly especially when there are less than eighty years remaining. Anyone in Hyde Park with a lease drawing near to 81 years unexpired should seriously consider extending it as soon as possible. Once a lease has under 80 years remaining, under the relevant legislation the landlord can calculate and demand a larger amount, based on a technical calculation, known as “marriage value” which is payable.
Leasehold residencies in Hyde Park with in excess of 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 merit it.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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. |
Regardless of whether you are a tenant or a landlord in Hyde Park,the lease extension solicitors that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Hyde Park valuers.
Kian was the the leasehold owner of a high value flat in Hyde Park being sold with a lease of a few days over 61 years unexpired. Kian on an informal basis approached his freeholder being a well known local-based freehold company and enquired on a premium to extend the lease. The landlord was keen to agree an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £100 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Kian to invoke his statutory right. Kian obtained expert legal guidance and secured an acceptable resolution without going to tribunal and ending up with a market value flat.
Last Christmas we were called by Dr Omar Roberts , who moved into a purpose-built flat in Hyde Park in September 1995. We are asked if we could estimate the premium would be to prolong the lease by a further 90 years. Comparative homes in Hyde Park with 100 year plus lease were in the region of £261,600. The average amount of ground rent was £60 collected yearly. The lease finished on 10 January 2078. Having 52 years outstanding we estimated the compensation to the landlord for the lease extension to be between £39,000 and £45,000 not including legals.
Last year we were phoned by Ms E Norbert , who took over the lease of a purpose-built flat in Hyde Park in May 2009. We are asked if we could approximate the premium could be for a 90 year extension to my lease. Identical flats in Hyde Park with an extended lease were in the region of £218,000. The average ground rent payable was £45 collected every twelve months. The lease expired in 2089. Taking into account 63 years outstanding we approximated the compensation to the freeholder for the lease extension to be between £17,100 and £19,800 exclusive of fees.