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 expense of a lease extension can escalate significantly once the remaining term is below than eighty years
Leasehold properties in Hadley Wood with in excess of one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little to be gained by buying the reversionary interest unless savings on ground rent and estate charges merit 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
Irrespective of whether you are a tenant or a freeholder in Hadley Wood,the lease extension lawyers that we work with will always be happy to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Hadley Wood valuers.
Two years ago Benjamin, came critically near to the eighty-year mark with the lease on his garden flat in Hadley Wood. In buying his home twenty years previously, the unexpired term was of no concern. Thankfully, he realised he would soon be paying way over the odds for Extending the lease. Benjamin was able to extend his lease at the eleventh hour in September. Benjamin and the landlord who owned the flat above subsequently agreed on a premium of £6,000 . If he failed to meet the deadline, the price would have become more costly by a minimum £875.
Last Autumn we were phoned by Mrs T Petit , who moved into a recently refurbished flat in Hadley Wood in February 1996. We are asked if we could approximate the price could be for a ninety year lease extension. Comparative residencies in Hadley Wood with an extended lease were valued about £285,000. The mid-range amount of ground rent was £55 invoiced yearly. The lease ended in 2105. Considering the 79 years as a residual term we approximated the premium to the landlord to extend the lease to be within £13,300 and £15,400 exclusive of expenses.
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 term was 76 years.