It’s a harsh certainty that a Hoxton residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the depreciation being disguised by increases in the Hoxton property prices.Where your lease has approximately ninety years left, you need to 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 dips under eighty years - otherwise a higher amount will be due. Most flat owners in Hoxton will be able to extend under the legislation; however a conveyancing solicitor will be able to clarify whether you qualify for an extension. In some cases you may not be entitled. There are also strict timeframes and procedures to follow once the process is initiated and you will need to be guided by your conveyancing solicitor throughout the formalities.
Leasehold residencies in Hoxton with more than one hundred years unexpired on the lease are often 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 upside in purchasing the freehold unless savings on ground rent and service charges warrant it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | |
| Barnsley Building Society | |
| Birmingham Midshires | |
| Coventry Building Society | |
| National Westminster Bank |
The conveyancing solicitors that we work with procure Hoxton 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 lawyer we work with provide it.
Andrew owned a 2 bedroom apartment in Hoxton on the market with a lease of a few days over 59 years remaining. Andrew informally contacted his landlord a well known Bristol-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £125 per annum. No ground rent would be payable on a lease extension were Andrew to invoke his statutory right. Andrew obtained expert advice and was able to make a more informed decision and handle with the matter and readily saleable.
In 2012 we were approached by Dr J Thompson who, having acquired a garden flat in Hoxton in November 2011. The dilemma was if we could approximate the premium would likely be for a ninety year lease extension. Similar premises in Hoxton with an extended lease were worth £184,000. The mid-range ground rent payable was £55 collected quarterly. The lease terminated in 2079. Given that there were 53 years outstanding we calculated the compensation to the freeholder for the lease extension to be within £28,500 and £33,000 not including fees.
An example of a Lease Extension decision for a Hoxton flat is 137 & 139 Haberdasher Street in December 2013. The Tribunal determines in accordance with section 48 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 that the premium for the extended lease for each Property should be £12,350.00. This case affected 2 flats. The unexpired term as at the valuation date was 72.39 years.