Unfortunately that a Handsworth residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is taken for granted in the first few years due to the depreciation being disguised by increases in the Handsworth property market.Where your lease has approximately 90 years left, you should start thinking about a lease extension. If the number of years remaining slips under 80 years, you will then be required to pay half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. The marriage fee is the amount of additional value that a lease extension will add the property The majority of flat owners in Handsworth will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify if you are eligibility. 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 from beginning to end of the process.
It is conventional wisdom that a property with more than one hundred years remaining is worth roughly the same as a freehold. Where an further 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| National Westminster Bank | Mortgage term plus 30 years. |
| 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 |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
Using our service gives you enhanced control over the value of your Handsworth leasehold, as your property will be more valuable and saleable in respect of lease length should you want to sell. The lawyers that we work with have a in-depth market knowledge handling many hundreds of lease extensions or freehold purchase transactions.
Trailing unsuccessful correspondence with the freeholder of her one bedroom flat in Handsworth, Sarah started the lease extension process as the eighty year threshold was rapidly nearing. The transaction was finalised in February 2005. The freeholder’s charges were kept to an absolute minimum.
Mrs Rosie Michel owned a ground floor flat in Handsworth in July 2006. The dilemma was if we could shed any light on how much (roughly) premium would be to extend the lease by 90 years. Comparative premises in Handsworth with 100 year plus lease were valued about £235,600. The average amount of ground rent was £60 collected yearly. The lease came to a finish on 27 February 2086. Taking into account 62 years left we approximated the premium to the freeholder to extend the lease to be between £21,900 and £25,200 exclusive of fees.
In 2013 we were e-mailed by Mr and Mrs. R Cook who, having owned a basement flat in Handsworth in January 2009. The dilemma was if we could shed any light on how much (approximately) compensation to the landlord could be to prolong the lease by 90 years. Similar premises in Handsworth with 100 year plus lease were valued about £174,200. The mid-range amount of ground rent was £55 billed monthly. The lease ran out in 2075. Having 51 years left we calculated the compensation to the landlord for the lease extension to be within £31,400 and £36,200 not including costs.