It’s an underpublicised certainty that a Heathfield residential lease is a wasting asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the first few years due to the reduction being disguised by increases in the Heathfield property prices.Once your lease nears 85ish years, you should start thinking about a lease extension. If lease term falls under 80 years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property The majority of flat owners in Heathfield will be able to extend under the legislation; however a conveyancer should be able to clarify whether you qualify for an extension. In some situations you may not qualify. There are also strict deadlines and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer throughout the formalities.
It is conventional wisdom that a property with over 100 years unexpired lease term is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the property will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The conveyancers that we work with undertake 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 conveyancing solicitor we work with provide it.
After lengthy discussions with the landlord of her two bedroom apartment in Heathfield, Alicia initiated the lease extension process just as the lease was approaching the crucial eighty-year deadline. The lease extension was concluded in June 2014. The freeholder’s charges were kept to an absolute minimum.
Last Christmas we were phoned by Mr and Mrs. R Morris , who moved into a ground floor apartment in Heathfield in March 2002. We are asked if we could shed any light on how much (approximately) premium would likely be for a 90 year extension to my lease. Similar flats in Heathfield with an extended lease were worth £232,800. The average amount of ground rent was £45 invoiced yearly. The lease came to a finish on 3 January 2090. Considering the 65 years as a residual term we calculated the premium to the freeholder to extend the lease to be within £13,300 and £15,400 exclusive of legals.
In 2014 we were contacted by Mr and Mrs. O Campbell who, having acquired a one bedroom flat in Heathfield in July 2005. We are asked if we could approximate the compensation to the landlord would be to prolong the lease by ninety years. Similar residencies in Heathfield with 100 year plus lease were in the region of £275,000. The mid-range amount of ground rent was £55 invoiced yearly. The lease terminated in 2101. Taking into account 76 years as a residual term we approximated the compensation to the freeholder to extend the lease to be between £9,500 and £11,000 not including professional charges.