The re-sale value of a leasehold property in Canning Town is impacted by how many years the lease has left to run. If it is near to or less than 80 years you should expect difficulties on re-sale, so it is advisable to arrange for the lease to be extended ahead of buying. It is ideal to start the process of extending the lease is when a lease still has 82 years remaining so that all matters can be addressed well before the 80 year mark. Statute enables Canning Town qualifying lessees to obtain a lease extension of ninety years in addition to the remaining lease term at a peppercorn rent (that is, rent free). The reason of the valuation is to determine the amount payable by the lessee to the freeholder for the acquisition of the lease extension.
It is conventional wisdom that a property with over 100 years remaining is worth approximately the same as a freehold. Where an additional 90 years added to all but the shortest lease, the residence 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 should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. 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; |
| 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. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
Lease extensions in Canning Town can be a difficult process. We recommend you secure professional help from a lawyer and valuer with experience in this area.
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 a wealth of experience dealing with Canning Town lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
In recent months Seth, came seriously close to the eighty-year threshold with the lease on his two bedroom apartment in Canning Town. In buying his home twenty years ago, the unexpired term was of minimal concern. Fortunately, he noticed he would imminently be paying an inflated amount for Extending the lease. Seth arranged for a lease extension just ahead of time in May. Seth and the freeholder ultimately agreed on sum of £5,000 . If the lease had gone below 80 years, the price would have become more costly by a minimum £1,150.
Mr Y Wilson acquired a purpose-built apartment in Canning Town in February 1999. We are asked if we could estimate the premium would likely be for a ninety year extension to my lease. Comparable flats in Canning Town with an extended lease were worth £264,000. The mid-range ground rent payable was £60 billed annually. The lease ended on 27 February 2078. Considering the 53 years outstanding we calculated the compensation to the landlord for the lease extension to be within £37,100 and £42,800 exclusive of professional charges.
An example of a Lease Extension decision for a Canning Town flat 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 was 69.77 years.