Unfortunately that a East Barnet 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 reduction being disguised by increases in the East Barnet property market.Once your lease gets to 85ish years, you should start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips lower than 80 years - otherwise a higher premium will be payable. The majority of flat owners in East Barnet will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm whether you are eligibility. In some situations you may not qualify. There are also strict timetables and procedures to follow once the process has commenced and you will need to be guided by your conveyancer for the duration of the process.
Leasehold properties in East Barnet with more than one hundred years remaining 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 circumstances there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges justify 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. |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Engaging our service will provide you better control over the value of your East Barnet leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Last Autumn Noah, started to get close to the 80-year threshold with the lease on his garden apartment in East Barnet. In buying his property two decades ago, the unexpired term was of no concern. As luck would have it, he became aware that he needed to take action soon on Extending the lease. Noah extended the lease at the eleventh hour last June. Noah and the freeholder via the management company subsequently settled on the final figure of £6,000 . If he failed to meet the deadline, the sum would have become more exhorbitant by a minimum £925.
In 2014 we were approached by Mr F Adams who, having completed a first floor flat in East Barnet in April 2008. We are asked if we could approximate the price would likely be for a ninety year extension to my lease. Comparative properties in East Barnet with a long lease were valued about £200,800. The average amount of ground rent was £65 invoiced per annum. The lease ended on 4 October 2085. Having 60 years as a residual term we calculated the compensation to the landlord to extend the lease to be between £20,900 and £24,200 not including expenses.
An example of a Freehold Enfranchisement case for a East Barnet flat is 23 Beaconsfield Road in July 2013. The Tribunals decided that the amount payable was £31,203 for the freehold. This case affected 2 flats. The unexpired term was 70.31 years.