It’s an underpublicised truth that a West Hendon residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the West Hendon property market.Where your lease has approximately ninety years left, you need to start considering a lease extension. If the number of years remaining dips below 80 years, you will then be required to pay half 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 extra value that a lease extension will add the property The majority of leasehold owners in West Hendon will be able to extend under the legislation; however a conveyancer should be able to confirm whether you qualify for an extension. In some situations you may not qualify. There are also strict timeframes and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer for the duration of the formalities.
Leasehold residencies in West Hendon with in excess of one hundred years left 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 home. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Engaging our service gives you enhanced control over the value of your West Hendon leasehold, as your property will be more valuable and marketable in terms of lease length should you want to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Jacob owned a 2 bedroom flat in West Hendon on the market with a lease of a few days over 72 years outstanding. Jacob informally contacted his landlord being a well known local-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years subject to a new rent initially set at £150 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Jacob to exercise his statutory right. Jacob obtained expert legal guidance and was able to make a more informed decision and handle with the matter and ending up with a market value flat.
Last year we were phoned by Mr I Roux , who took over the lease of a ground floor apartment in West Hendon in August 2000. The dilemma was if we could approximate the premium could be to prolong the lease by a further 90 years. Similar flats in West Hendon with a long lease were valued about £200,800. The mid-range ground rent payable was £65 collected quarterly. The lease concluded on 2 June 2085. Considering the 60 years unexpired we approximated the premium to the freeholder for the lease extension to be within £20,900 and £24,200 exclusive of fees.
An example of a Lease Extension matter before the tribunal for a West Hendon property is First Floor Flat 61 Wilberforce Road in March 2014. The premium payable was £10,130 and the case was remitted back to the Willesden County Court to effect the Vesting Order (Claim No 3W103100). This case affected 1 flat. The number of years remaining on the existing lease(s) was 71 years.