It’s an underpublicised truth that a Plaistow residential lease is a wasting asset. As the lease term reduces 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 Plaistow property market.Where your lease has approximately 90 years left, you need to 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 under 80 years - otherwise a higher premium will be payable. Most flat owners in Plaistow will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm if you qualify for an extension. In some cases you may not qualify. There are also strict timetables and procedures to follow once the process is initiated and you will need to be guided by your conveyancer throughout the process.
It is generally accepted that a property with more than one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an additional 90 years added to any lease with more than 45 years unexpired, the premises will be worth the same as 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. |
| 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. |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 30 years plus the term of the mortgage at the outset 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 |
Retaining our service will provide you enhanced control over the value of your Plaistow leasehold, as your property will be more valuable and marketable in respect of lease length should you wish to sell. The conveyancers that we work with are well versed in the legislation handling many hundreds of lease extensions or freehold purchase transactions.
Subsequent to lengthy negotiations with the freeholder of her garden flat in Plaistow, Harriet initiated the lease extension process just as her lease was nearing the all-important 80-year mark. The legal work was concluded in January 2013. The freeholder’s charges were kept to an absolute minimum.
Last Spring we were called by Dr Sam Leroy , who bought a ground floor apartment in Plaistow in September 1995. We are asked if we could approximate the price would likely be for a ninety year extension to my lease. Identical residencies in Plaistow with an extended lease were in the region of £218,000. The average ground rent payable was £45 collected every twelve months. The lease ended in 2089. Considering the 63 years left we estimated the compensation to the freeholder for the lease extension to be within £17,100 and £19,800 not including professional charges.
An example of a Lease Extension matter before the tribunal for a Plaistow 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 affected 1 flat. The unexpired term as at the valuation date was 69.77 years.