If you live in a leasehold flat within the sound of Bow Bells, the chances are that you have the right to extend your lease.
A law introduced in the early 1990s (the Leasehold Reform Housing and Urban Development Act 1993) allows you to extend your lease by 90 years and reduce your ground rent to nothing.
Whether you live in a period conversion in Bow, an ex-council flat in Stepney, or a modern apartment in Wapping, Homehold can help you with your lease extension.
The lease extension process has a number of elements to it, including property valuation, negotiation and legal conveyancing. At Homehold we offer a wrap-around service that offers the whole lease extension service at a fixed price.
Over the years we have worked with home-owners across the Borough of Tower Hamlets. From Limehouse to Bethnal Green and Cambridge Heath we are experienced in dealing with both private freeholders and Tower Hamlets Council – with whom we’ve worked with on a number of occasions.
Keen to get some help with your lease extension?
Who can extend?
If you live in a flat in the borough of Tower Hamlets there’s a good chance you can extend your lease. If you are looking to do a lease extension with Tower Hamlets council or Eastend Homes, it is almost guaranteed.
If you’ve bought your flat through a share-to-buy scheme you won’t have the right to extend your lease unless you’ve built up the percentage share of your ownership to 100%.
Another important detail is that you will need to have owned your flat for two years before you can start the lease extension process.
How much does a lease extension cost?
The cost of your lease extension is known in the trade as ‘the premium’. Three factors have a bearing on this figure.
- The market value of your flat
- How much you pay in ground rent (and whether it will increase in the future)
- The remaining length of your lease
Your premium will be noticeably higher if your lease is shorter than 80 years, or if you have a high ground rent. This is unlikely if you own an ex-local authority flat – in a block like Balfron Tower in Bow. This is because ex-council flats were generally sold in the 1980s when right-to-buy was introduced, and started with 125 year leases and £10 a year ground rents. Short leases and high ground rents are more common if you have a private freeholder.
The more valuable your flat, the greater your premium will be. At the time of writing, Rightmove has the average value of a Tower Hamlets flat as £533,000 (use this in our premium calculator if you’re unsure of the value of your flat). But values can vary considerably.
We’ve worked on everything from Thelbridge House in Bow where flats are valued around the £300k mark, to modern Gateway Housing apartments in Limehouse worth double that. The price effects the premium, but not your right to extend.
What is the lease extension process?
The lease extension process involves several steps, from assessing your lease, to valuing your property, serving legal notice to your freeholder, negotiation, and finally conveyancing your new lease.
We’re unusual at Homehold: we offer a top-to-tail service that includes everything. Crucially for your peace of mind, everything is essentially done in-house. We even have our own legal service team, LLS, regulated by the Solicitors Authority, who manage the legal aspect.
Stage 1: Valuation and Preparation
Our lease extension solicitors will review all the paperwork associated with your flat and the building its in. It’s important at the outset to have a complete and clear picture.
Next, a lease extension surveyor from the Homehold team will use a variety of data to establish the value of your property. A key factor here is looking at similar Tower Hamlets properties: it’s no use costing your lease extension on the value of a one-bed in Whitechapel, if yours is a penthouse in Poplar!
Stage 2: Notice Serving and Negotiation
Once we’re prepared, Homehold Solicitors will initiate the legal process by serving your freeholders a formal notice – something called a ‘Section 42 Notice’.
The freeholder then has 75 days (a mandatory two months, plus some time for postage) to respond with their ‘Counter Notice’. More often than not this will also include a counter-offer for the premium
We then negotiate with the freeholder to make sure you’re getting a good price. This is where the research from stage one is crucial. Information is power and we’re committed to getting a good price for Tower Hamlets leaseholders.
Stage 3: Conveyancing and Completion
Once the details of your lease extension have been agreed on, the last step is the paperwork. It’s important to make sure your new lease accurately reflects what’s been negotiated. Our lease extension solicitors will review the documents prepared by the freeholder’s legal team.
Once it’s been signed, sealed and delivered, your lease will have been extended by 90 years and your rent will have reduced to peppercorn (nil). Nothing else in the document is altered.
How much do Homehold charge?
We offer a fix-fee lease extension process for £2,325+VAT.
This is broken into three equal instalments of £775+VAT.
In addition to the steps described above, the figure includes any incidental costs such as Land Registry fees.
We don't outsource. The legal work is contracted internally to our own law firm, Leasehold Legal Services.
Why use Homehold
We have considerable experience extending leases in Tower Hamlets.
“With a blend of many ex-local authority buildings and modern blocks from the 1980s and 90s, there are a lot of leaseholders in Tower Hamlets. We almost always have cases open in the borough, and benefit from a good working relationship with the council.” Leah Veasey, Solicitor and Legal Director at LLS
But your flat is not just another flat in East London: it’s your home and your investment. We treat that with the respect and attention it deserves.
If you flick through our reviews you’ll find satisfied leaseholders from Blackwall to Spitalfields.
Hear it from another flat owner in Tower Hamlets
I highly recommend Homehold. They navigated and secured the purchase of a freehold which had alluded and frustrated me for years. From start to finish Homehold are on their game, very knowledgeable, transparent communications and fair in their negotiations.
Shaun, Tower Hamlets