Unfortunately that a Dagenham residential lease is a deteriorating asset. The lease value drops in proportion to its lease length. The extent of this is taken for granted in the early years due to the loss of value being disguised by increases in the Dagenham property market.Where your lease has approximately ninety 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 slips below eighty years - otherwise a higher amount will be payable. Most flat owners in Dagenham will be able to extend under the legislation; however a conveyancer will be able to clarify if you are eligibility. In some cases you may not be entitled. There are also strict timetables and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancing solicitor from beginning to end of the formalities.
Leasehold residencies in Dagenham with in excess of 100 years left on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little upside in buying the reversionary interest unless savings on ground rent and estate charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| 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 |
| 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. |
Using our service will provide you increased control over the value of your Dagenham leasehold, as your property will be more valuable and saleable 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.
Archie owned a 2 bedroom apartment in Dagenham being marketed with a lease of just over 72 years remaining. Archie informally spoke with his landlord being a well known Bristol-based freehold company for a lease extension. The freeholder was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent at the outset set at £200 per annum and doubled every twenty five years thereafter. No ground rent would be due on a lease extension were Archie to invoke his statutory right. Archie obtained expert advice and was able to make an informed judgement and handle with the matter and sell the flat.
Last Spring we were contacted by Mr and Mrs. O Brown , who took over the lease of a purpose-built flat in Dagenham in February 2010. We are asked if we could estimate the premium would likely be to prolong the lease by a further 90 years. Identical flats in Dagenham with 100 year plus lease were valued around £250,400. The mid-range ground rent payable was £65 invoiced quarterly. The lease came to a finish on 10 October 2090. Taking into account 64 years as a residual term we estimated the compensation to the landlord to extend the lease to be between £19,000 and £22,000 exclusive of expenses.
An example of a Lease Extension matter before the tribunal for a Dagenham residence is 49 Aldborough Road South in July 2012. The Tribunal decided that the premium payable for the grant of the new lease was £13,925 This case related to 1 flat. The unexpired lease term was 61.36 years.