The market value of Plaistow leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of a lease extension can escalate significantly once the remaining term is below than eighty years
Leasehold premises in Plaistow with over one hundred years remaining on the lease are often referred to as ‘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 buying the reversionary interest unless savings on ground rent and maintenance charges justify it.
| 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. |
| 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. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| Yorkshire 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. |
Engaging our service gives you enhanced control over the value of your Plaistow leasehold, as your property will be more valuable and marketable in relation to the lease length should you decide to sell. The lawyers that we work with have a wealth of experience of handling many hundreds of lease extensions or freehold purchase transactions.
Two years ago Nathaniel, started to get near to the 80-year mark with the lease on his leasehold apartment in Plaistow. In buying his flat 19 years ago, the unexpired term was of minimal bearing. As luck would have it, it dawned on him that he would soon be paying way over the odds for Extending the lease. Nathaniel arranged for a lease extension just in the nick of time in May. Nathaniel and the landlord who owned the flat above ultimately settled on an amount of £6,000 . If he not met the deadline, the premium would have gone up by at least £1,150.
Last year we were called by Mr and Mrs. Y Wilson , who owned a purpose-built apartment in Plaistow in October 2008. We are asked if we could approximate the premium could be for a ninety year lease extension. Comparable properties in Plaistow with a long lease were worth £193,400. The mid-range amount of ground rent was £65 collected per annum. The lease terminated on 17 February 2084. Given that there were 59 years as a residual term we estimated the compensation to the freeholder for the lease extension to be within £21,900 and £25,200 not including expenses.
An example of a Lease Extension decision for a Plaistow premises is 46 Credon Road in January 2014. On 11 September 2013 Deputy District Judge Price sitting at the Bow County Court made a vesting order that the freeholder surrender his lease and be granted a new lease of the Premises on such terms as may be determined by the First Tier Tribunal (Property Chamber).The appropriate sum as concluded by the Tribunal was £7225 This case was in relation to 1 flat. The unexpired lease term was 69.77 years.