Hermitage leases on residential properties are gradually losing value. Where your lease has approximately ninety years remaining, you should start considering the need for a lease extension. Eighty years is a significant number: when the unexpired term of a lease dips below this level then you start incurring an additional element called marriage value. Leasehold owners in Hermitage will usually qualify for a lease extension; however a solicitor should be able confirm your eligibility. In certain situations you may not qualify. There are also strict timetables and steps to comply with once the process has started so it’s sensible to be guided by a conveyancer during the process.
It is conventional wisdom that a residential leasehold with over 100 years unexpired lease term is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the property will be equivalent in value to 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| Chelsea 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
Lease extensions in Hermitage can be a difficult process. We recommend you secure professional help from a conveyancing solicitor and valuer with experience in lease extensions.
We provide you with an expert from a selection of lease extension solicitors, which ensures a targeted and efficient service as you have a dedicated port of call with an individual lawyer. Our lease extension solicitors have a wealth of experience dealing with Hermitage lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Subsequent to unsuccessful correspondence with the freeholder of her garden apartment in Hermitage, Imogen commenced the lease extension process as the 80 year deadline was rapidly advancing. The legal work was finalised in September 2005. The landlord’s costs were negotiated to about 600 pounds.
In 2010 we were e-mailed by Mr Harrison Girard who, having took over the lease of a purpose-built apartment in Hermitage in April 2007. We are asked if we could estimate the compensation to the landlord could be to extend the lease by an additional years. Comparative flats in Hermitage with 100 year plus lease were in the region of £166,800. The average ground rent payable was £50 collected monthly. The lease finished in 2075. Given that there were 50 years as a residual term we estimated the compensation to the freeholder to extend the lease to be within £32,300 and £37,400 exclusive of expenses.
Mr and Mrs. V Díaz acquired a newly refurbished flat in Hermitage in August 2006. We are asked if we could shed any light on how much (roughly) premium would likely be to prolong the lease by an additional years. Similar homes in Hermitage with an extended lease were valued about £280,000. The average amount of ground rent was £45 billed per annum. The lease ended on 11 October 2095. Given that there were 70 years remaining we calculated the premium to the freeholder to extend the lease to be within £12,400 and £14,200 plus legals.