It’s a harsh certainty that a Silvertown residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the reduction being disguised by increases in the Silvertown property market.Where your lease has approximately 90 years left, you should start considering 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 below eighty years - otherwise a higher amount will be due. The majority of flat owners in Silvertown will be able to extend under the legislation; however a lawyer will be able to confirm if 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 has commenced and you will need to be guided by your lawyer for the duration of the formalities.
It is conventional wisdom that a residential leasehold with over 100 years remaining is worth roughly the same as a freehold. Where an additional 90 years added to any lease with more than 35 years remaining, the property 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. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage are not acceptable. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| 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. |
| 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. |
Regardless of whether you are a tenant or a landlord in Silvertown,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Silvertown valuers.
Trailing unsuccessful correspondence with the freeholder of her purpose-built flat in Silvertown, Mollie started the lease extension process as the 80 year mark was swiftly coming. The legal work completed in February 2014. The landlord’s charges were restricted to under 700 GBP.
Last May we were called by Dr G Roberts , who completed a basement apartment in Silvertown in June 1995. The question was if we could estimate the premium would likely be to prolong the lease by ninety years. Comparable residencies in Silvertown with a long lease were valued around £193,400. The average ground rent payable was £65 billed annually. The lease elapsed on 6 October 2085. Taking into account 59 years outstanding we approximated the compensation to the landlord for the lease extension to be within £21,900 and £25,200 plus legals.
An example of a Lease Extension case for a Silvertown property 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 related to 1 flat. The unexpired term as at the valuation date was 69.77 years.