With a domestic leasehold property in Hainault, you are actually buying a right to reside in a property for a prescribed time frame. These days flat leases typically tend to be for 99 years or 125. Many leasehold owners are unconcerned as this seems like a lengthy period of time, you should consider extending the lease sooner as opposed to later. The general rule is that the shorter the lease is the cost of extending the lease increases markedly particularly once there are less than 80 years remaining. Leasehold owners in Hainault with a lease drawing near to 81 years remaining should seriously think of extending it without delay. When a lease has less than eighty years remaining, under the relevant Act the landlord is entitled to calculate and charge a larger premium, based on a technical calculation, known as “marriage value” which is payable.
It is generally accepted that a residential leasehold with over one hundred years remaining is worth approximately the equivalent as a freehold. Where an further ninety years added to any lease with more than 45 years remaining, the premises will be worth the same as a freehold for many years in the future.
| 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. |
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Leeds Building Society | 85 years remaining from the start 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. |
| 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 |
Irrespective of whether you are a tenant or a freeholder in Hainault,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 in-depth market knowledge and the close ties they enjoy with Hainault valuers.
Seth was the the leasehold owner of a conversion flat in Hainault being sold with a lease of fraction over sixty years unexpired. Seth informally contacted his freeholder being a well known Manchester-based freehold company for a lease extension. The freeholder was keen to give 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 increase every 25 years thereafter. Ordinarily, ground rent would not be due on a lease extension were Seth to exercise his statutory right. Seth obtained expert legal guidance and secured satisfactory deal without going to tribunal and readily saleable.
Last Autumn we were phoned by Mr and Mrs. O Scott , who was assigned a lease of a garden flat in Hainault in September 2008. The question was if we could approximate the premium could be to extend the lease by ninety years. Comparative flats in Hainault with 100 year plus lease were worth £205,000. The average amount of ground rent was £50 invoiced yearly. The lease expired in 2104. Considering the 78 years left we estimated the compensation to the freeholder to extend the lease to be between £8,600 and £9,800 plus costs.
An example of a Freehold Enfranchisement case for a Hainault premises is 201 & 201a St. Barnabas Road in October 2013. The Tribunal decided that the price to be paid by the Applicants for the freehold interest is £20,071. This case was in relation to 2 flats. The unexpired residue of the current lease was 69.26 years.