There is no doubt about it a leasehold property in Homerton is a wasting asset as a result of the shortening lease. If the lease has, over 125 years remaining then this decrease may be negligible that being said there will become a point in time when a lease has fewer than 80 years unexpired as part of the premium you will incur is what is termed as a marriage value. This could increase sharply the cost. It is the main logic behind why you should consider extending sooner rather than later. The majority of flat owners in Homerton will qualify for this right; that being said a lawyer can advise if you are eligible to extend your lease. In certain situations you may not qualify, the most frequent reason being that you have owned the property for less than two years.
Leasehold residencies in Homerton with more than one hundred years remaining on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little upside in buying the freehold unless savings on ground rent and service charges warrant it.
| 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; |
| 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. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Homerton can be a difficult process. We recommend you get guidance from a lawyer 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 a wealth of experience 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.
In recent months Theo, started to get close to the 80-year threshold with the lease on his leasehold flat in Homerton. Having purchased his flat two decades ago, the length of the lease was of minimal importance. As luck would have it, he realised he needed to take action soon on a lease extension. Theo was able to extend his lease at the eleventh hour last January. Theo and the freeholder via the managing agents in the end agreed on a premium of £5,000 . If he not met the deadline, the sum would have increased by at least £1,075.
In 2010 we were contacted by Mrs A Walker who, having owned a garden apartment in Homerton in July 2006. We are asked if we could estimate the premium could be to prolong the lease by a further 90 years. Identical flats in Homerton with 100 year plus lease were valued about £176,200. The average amount of ground rent was £65 collected monthly. The lease elapsed in 2082. Taking into account 56 years left we calculated the compensation to the landlord to extend the lease to be within £29,500 and £34,000 plus costs.
An example of a Freehold Enfranchisement matter before the tribunal for a Homerton flat 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 residue of the current lease was 71.25 years.