On the balance of probabilities if you own a flat in Forest Gate you actually own a long leasehold interest over your property
It is generally considered that a residential leasehold with over 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional 90 years added to all but the shortest lease, the premises will be worth the same as a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Barnsley Building Society | 60 years from the date of the mortgage application subject to 35 years remaining at the end of the mortgage term. |
| 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. |
| 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. |
| 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. |
Engaging our service gives you increased control over the value of your Forest Gate leasehold, as your property will be more valuable and saleable in relation to the lease length should you decide to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Leon was the the leasehold proprietor of a studio flat in Forest Gate on the market with a lease of fraction over sixty years unexpired. Leon on an informal basis contacted his landlord being a well known local-based freehold company and enquired on a premium to extend the lease. The landlord indicated a willingness to extend the lease to 125 years on the basis of a rise in the rent to £200 yearly. No ground rent would be due on a lease extension were Leon to exercise his statutory right. Leon procured expert advice and was able to make an informed judgement and deal with the matter and sell the property.
In 2013 we were e-mailed by Mrs P Lefebvre who, having took over the lease of a ground floor apartment in Forest Gate in September 2007. We are asked if we could approximate the compensation to the landlord could be for a 90 year lease extension. Identical properties in Forest Gate with 100 year plus lease were valued about £270,000. The average amount of ground rent was £65 billed per annum. The lease concluded on 14 April 2092. Taking into account 68 years as a residual term we estimated the compensation to the freeholder for the lease extension to be between £12,400 and £14,200 plus costs.
An example of a Freehold Enfranchisement case for a Forest Gate property is 52 & 54 Green Street in February 2010. Following a vesting order by the County Court the Tribunal decided that the price that the Applicant for the freehold interest should pay is £20,543 This case was in relation to 2 flats. The number of years remaining on the existing lease(s) was 78 and 80.