Unfortunately that a Dockland Settlement residential lease is a wasting asset. The lease value reduces in proportion to its lease length. The extent of this is not fully appreciated in the early years due to the loss of value being disguised by increases in the Dockland Settlement property prices.Once your lease nears 85ish years, you should start thinking about a lease extension. If lease term slips below eighty years, you will end up paying half of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of additional value that a lease extension will add the property Most flat owners in Dockland Settlement will be able to extend under the legislation; however a lawyer will be able to clarify whether you qualify for an extension. In some cases you may not be entitled. There are also strict deadlines 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.
It is generally considered that a property with in excess of one hundred years unexpired lease term is worth approximately the equivalent as a freehold. Where an further 90 years added to all but the shortest lease, the residence will be equivalent in value to a freehold for many years ahead.
| 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. |
| 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. |
| 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 |
The lawyers that we work with undertake Dockland Settlement lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The conveyancing solicitor we work with provide it.
Ryan was the the leasehold proprietor of a studio apartment in Dockland Settlement being marketed with a lease of fraction over fifty eight years unexpired. Ryan informally contacted his freeholder a well known local-based freehold company and enquired on a premium to extend the lease. The freeholder was prepared to agree an extension on non-statutory terms taking the lease to 125 years subject to an increased rent to £50 per annum. No ground rent would be payable on a lease extension were Ryan to invoke his statutory right. Ryan obtained expert legal guidance and was able to make an informed judgement and deal with the matter and sell the property.
Last year we were phoned by Ms Danielle Lewis , who moved into a ground floor flat in Dockland Settlement in October 2008. We are asked if we could approximate the price could be to prolong the lease by a further 90 years. Similar residencies in Dockland Settlement with 100 year plus lease were valued around £261,600. The average ground rent payable was £60 collected monthly. The lease terminated on 2 February 2077. Taking into account 52 years as a residual term we estimated the compensation to the landlord for the lease extension to be within £39,000 and £45,000 plus costs.
An example of a Lease Extension decision for a Dockland Settlement residence is 73 Walerand Road in August 2012. the result of the findings of the Tribunal led to a premium to be paid for the extended lease in respect of Flat 73 in the sum of £10,040. The premium applicable in respect of Flat 85 was £5,710. This case affected 2 flats. The unexpired residue of the current lease was 72 years.