Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. your lease will ordinarily be granted for a fixed period of time , ordinarily 99 or 125 years, although we have seen longer and shorter terms in Homerton. Clearly, the period of lease remaining reduces over time. This is often ignored and only raises itself as an issue when the flat or house needs to be disposed of or refinanced. The shorter the lease the lower the value of the property and the more it will cost to extend the lease. Qualifying leaseholders in Homerton have the legal entitlement to extend the lease for a further 90 years under legislation. Please give due deliberation before putting off your Homerton lease extension. Holding off that expense now likely increases the price you will eventually have to pay for a lease extension
Leasehold properties in Homerton with over 100 years outstanding on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your home. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
Lease extensions in Homerton can be a difficult process. We recommend you obtain guidance from a conveyancing solicitor and surveyor well versed in the legislation and lease extension process.
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 in-depth market knowledge procuring Homerton lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Kai owned a studio flat in Homerton on the market with a lease of just over 59 years left. Kai informally approached his freeholder being a well known London-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to grant an extension taking the lease to 125 years subject to a rise in the rent to £50 yearly. No ground rent would be due on a lease extension were Kai to invoke his statutory right. Kai procured expert legal guidance and secured an acceptable resolution without resorting to tribunal and readily saleable.
In 2014 we were contacted by Dr Seth Harris who, having acquired a ground floor apartment in Homerton in June 1997. We are asked if we could estimate the compensation to the landlord would be to prolong the lease by ninety years. Comparable premises in Homerton with a long lease were valued around £173,800. The average ground rent payable was £65 collected annually. The lease expired in 2080. Considering the 55 years left we calculated the compensation to the freeholder for the lease extension to be within £31,400 and £36,200 exclusive of legals.
An example of a Freehold Enfranchisement decision for a Homerton premises is 104 Nightingale Road in May 2009. The Tribunal's Decision is that the premium torbe paid for the enfranchisement in this case is £112,174 This case affected 10 flats. The unexpired term was 71.25 years.