Unfortunately that a West Hendon residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the first few years due to the loss of value being disguised by increases in the West Hendon property prices.Once your lease gets to 85ish years, you need to start considering a lease extension. An important point to note is that it is desirable for lease extension to take place before the term of the existing lease slips lower than eighty years - otherwise a higher amount will be due. Most flat owners in West Hendon will be able to extend under the legislation; however a lawyer will be able to clarify whether you are eligibility. In some situations you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process is instigated and you will need to be guided by your lawyer for the duration of the process.
It is generally accepted that a property with over one hundred years remaining is worth roughly 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 are not acceptable. 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; |
| 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. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| 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. |
Regardless of whether you are a tenant or a landlord in West Hendon,the lease extension experts that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with West Hendon valuers.
During the course of the last few months Max, came precariously close to the eighty-year threshold with the lease on his garden flat in West Hendon. Having purchased his flat twenty years ago, the unexpired term was of little bearing. As luck would have it, he realised he would soon be paying an escalated premium for a lease extension. Max arranged for a lease extension just ahead of time last March. Max and the freeholder via the management company in the end settled on sum of £5,500 . If he failed to meet the deadline, the amount would have increased by at least £1,075.
Mrs Kirsty Mercier purchased a one bedroom flat in West Hendon in February 2005. We are asked if we could estimate the premium would likely be to extend the lease by an additional years. Identical premises in West Hendon with a long lease were valued around £260,000. The average ground rent payable was £50 collected annually. The lease terminated in 2099. Taking into account 73 years remaining we estimated the compensation to the freeholder to extend the lease to be within £9,500 and £11,000 not including fees.
An example of a Lease Extension matter before the tribunal for a West Hendon property is First Floor Flat 61 Wilberforce Road in March 2014. The premium payable was £10,130 and the case was remitted back to the Willesden County Court to effect the Vesting Order (Claim No 3W103100). This case affected 1 flat. The remaining number of years on the lease was 71 years.