The re-sale value of a leasehold property in Poplar is impacted by how many years the lease has remaining. If it is near to or less than 80 years you should anticipate difficulties on re-sale, so it is recommended to arrange for the lease to be extended prior to buying. It is preferable to commence the process of extending the lease is when a lease still has 82 years unexpired so that all matters can be concluded in advance of the eighty year mark. Current legislation enables Poplar qualifying lessees to obtain a lease extension of 90 years on top of the remaining length of the lease at a peppercorn rent (that is, rent free). The intention of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
Leasehold residencies in Poplar with over 100 years left on the lease are often regarded as a ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little to be gained by purchasing the reversionary interest unless savings on ground rent and maintenance charges justify it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 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. |
| 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. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Skipton Building Society | 85 years from the date of completion of the mortgage For Buy to Let cases: - lettings must not breach any of the lessee’s covenants; and - consent of the lessor to lettings must be obtained if necessary |
Lease extensions in Poplar can be a difficult process. We recommend you get guidance from a lawyer and surveyor with experience in lease extensions.
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 procuring Poplar lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In 2014 Dexter, started to get close to the eighty-year mark with the lease on his purpose- built flat in Poplar. In buying his home two decades ago, the unexpired term was of little bearing. As luck would have it, he became aware that he would soon be paying way over the odds for Extending the lease. Dexter was able to extend his lease just ahead of time last January. Dexter and the landlord eventually agreed on an amount of £6,000 . If the lease had slid to less than eighty years, the premium would have gone up by a minimum £1,000.
In 2011 we were approached by Dr S Campbell who, having purchased a ground floor flat in Poplar in November 2010. The dilemma was if we could approximate the price would likely be for a 90 year extension to my lease. Comparable residencies in Poplar with 100 year plus lease were in the region of £250,000. The mid-range amount of ground rent was £50 collected every twelve months. The lease ended in 2094. Considering the 69 years as a residual term we calculated the premium to the freeholder to extend the lease to be within £9,500 and £11,000 plus legals.
An example of a Freehold Enfranchisement case for a Poplar property is 12, 14 & 16 Hull Close in May 2010. the Tribunal determined that the premium payable for the acquisition of the freehold to the subject premises was the sum of £18,300 This case related to 3 flats. The unexpired residue of the current lease was 101.61 years.