The value of Hadley Wood leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The cost of extending the lease can escalate materialy once the remaining term is less than 80 years
Leasehold properties in Hadley Wood with more than one hundred years unexpired 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 premises. In such situations there is often little upside in purchasing the freehold unless savings on ground rent and service charges warrant 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. |
| 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. |
Irrespective of whether you are a tenant or a freeholder in Hadley Wood,the lease extension experts that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Hadley Wood valuers.
Teddy was the the leasehold owner of a studio apartment in Hadley Wood on the market with a lease of fraction over fifty eight years unexpired. Teddy on an informal basis approached his freeholder a well known Manchester-based freehold company for a lease extension. The landlord was keen to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £150 per annum and doubled every twenty five years thereafter. Ordinarily, ground rent would not be payable on a lease extension were Teddy to invoke his statutory right. Teddy procured expert advice and was able to make a more informed judgement and handle with the matter and readily saleable.
In 2009 we were approached by Mr and Mrs. A Flores who, having bought a garden flat in Hadley Wood in February 2007. The question was if we could estimate the price would likely be for a 90 year extension to my lease. Comparative premises in Hadley Wood with 100 year plus lease were valued about £227,800. The mid-range ground rent payable was £45 billed every twelve months. The lease concluded on 16 January 2090. Having 65 years left we approximated the compensation to the freeholder for the lease extension to be within £13,300 and £15,400 plus legals.
An example of a Lease Extension matter before the tribunal for a Hadley Wood flat is Flat 2 2 Netherfield Road in April 2010. The Tribunale held that premium payable for a 90 year extension to the existing Lease should be £7,705. This case affected 1 flat. The unexpired lease term was 76 years.