Heathfield leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease gets more expensive. It is the case that most Heathfield tenants have the right to extend their lease by an additional ninety years in accordance with the 1993 Leasehold Reform Act. Where you are a leasehold owner in Heathfield you should see if your lease has between 70 and ninety years remaining. In particular once the remaining lease term slips under 80 years, the premium due on any lease extension sharply increases as part of the premium you pay is what is known as a marriage value
It is conventional wisdom that a residential leasehold with in excess of 100 years remaining is worth roughly the same as a freehold. Where an further 90 years added to any lease with more than 30 years left, the premises will be worth the same as a freehold for decades to come.
| 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. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| 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. |
The lawyers that we work with procure Heathfield lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
After unsuccessful negotiations with the freeholder of her two bedroom flat in Heathfield, Ashleigh commenced the lease extension process just as the lease was nearing the all-important eighty-year mark. The legal work was concluded in July 2013. The landlord’s charges were restricted to approximately 550 pounds.
Mr and Mrs. M Nguyen purchased a first floor flat in Heathfield in March 2005. We are asked if we could approximate the premium would be to prolong the lease by 90 years. Identical flats in Heathfield with 100 year plus lease were valued around £193,400. The average amount of ground rent was £65 billed yearly. The lease elapsed in 2084. Considering the 59 years outstanding we approximated the premium to the landlord to extend the lease to be within £21,900 and £25,200 plus fees.
In 2009 we were contacted by Ms Katie Alexander who, having bought a basement flat in Heathfield in February 2001. The question was if we could shed any light on how much (roughly) compensation to the landlord could be to prolong the lease by a further 90 years. Comparative homes in Heathfield with a long lease were in the region of £250,000. The mid-range amount of ground rent was £50 billed every twelve months. The lease expired on 28 October 2095. Having 70 years as a residual term we calculated the premium to the landlord for the lease extension to be between £9,500 and £11,000 not including costs.