Unfortunately that a Honor Oak residential lease is a deteriorating asset. As the lease term reduces so does the value of the property. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Honor Oak property prices.Once your lease gets to 85ish years, you should start thinking about 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 falls under 80 years - otherwise a higher amount will be due. Most flat owners in Honor Oak will be able to extend under the legislation; however a conveyancer will be able to clarify whether you qualify for an extension. In some situations you may not be entitled. There are also strict deadlines and procedures to follow once the process is initiated and you will need to be guided by your conveyancer throughout the process.
Leasehold properties in Honor Oak with over 100 years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Lease extensions in Honor Oak can be a difficult process. We recommend you get guidance from a conveyancing solicitor and surveyor with experience in this area.
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 dealing with Honor Oak lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Last Christmas Sam, came precariously near to the 80-year mark with the lease on his two bedroom flat in Honor Oak. In buying his flat two decades ago, the length of the lease was of little relevance. Luckily, he noticed he needed to take steps soon on Extending the lease. Sam extended the lease at the eleventh hour in May. Sam and the landlord who owned the flat above eventually agreed on an amount of £5,000 . If the lease had dipped to less than eighty years, the figure would have increased by a minimum £1,075.
Last month we were phoned by Mr Lewis Johnson , who was assigned a lease of a first floor flat in Honor Oak in October 2003. We are asked if we could approximate the premium would likely be for a ninety year lease extension. Comparative homes in Honor Oak with a long lease were in the region of £205,000. The average ground rent payable was £50 invoiced per annum. The lease finished on 9 July 2104. Given that there were 79 years remaining we calculated the compensation to the freeholder for the lease extension to be within £7,600 and £8,800 plus professional charges.
An example of a Lease Extension decision for a Honor Oak residence 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 number of years remaining on the existing lease(s) was 61.81 years.