With a residential leasehold property in Honor Oak, you are actually buying an entitlement to reside in a property for a prescribed time frame. Modern flat leases are usually granted for 99 years or 125. Even though this may appear like a long period of time, you should consider a lease extension sooner rather than later. The general rule is that the shorter the number of years is the cost of extending the lease increases markedly particularly when there are fewer than eighty years left. Anyone in Honor Oak with a lease approaching 81 years remaining should seriously think of extending it sooner rather than later. Once the lease term has under 80 years remaining, under the relevant Act the landlord is entitled to calculate and levy a larger amount, assessed on a technical multiplication, known as “marriage value” which is due.
It is conventional wisdom that a residential leasehold with in excess of 100 years remaining is worth roughly the equivalent as a freehold. Where an additional ninety years added to any lease with more than 35 years left, the premises will be equivalent in value to a freehold for decades to come.
| 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. |
| National Westminster Bank | Mortgage term plus 30 years. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
The lawyers that we work with undertake Honor Oak 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 conveyancer we work with provide it.
Last October Gabriel, came seriously near to the eighty-year mark with the lease on his studio flat in Honor Oak. Having purchased his flat 18 years ago, the length of the lease was of minimal concern. by good luck, he recognised he needed to take action soon on a lease extension. Gabriel arranged for a lease extension at the eleventh hour last April. Gabriel and the freeholder ultimately agreed on sum of £6,000 . If he failed to meet the deadline, the premium would have become more costly by a minimum £950.
In 2009 we were contacted by Mr and Mrs. T Lee who, having acquired a studio apartment in Honor Oak in July 2008. We are asked if we could estimate the price could be to extend the lease by 90 years. Comparable premises in Honor Oak with a long lease were in the region of £275,000. The average amount of ground rent was £65 invoiced monthly. The lease ended on 8 March 2093. Considering the 68 years remaining we approximated the premium to the freeholder for the lease extension to be between £12,400 and £14,200 exclusive of fees.
An example of a Lease Extension decision for a Honor Oak property is Flat 1 40-42 Ewelme Road in August 2012. the Tribunal assessed the premium for the lease extension in the sum of £11,800 This case was in relation to 1 flat. The unexpired term was 61.81 years.