Owning a apartment usually means owning a lease of the property, this is a ‘time-limited’ interest becoming shorter every day. The lease will normally be granted for a set period of time , usually 99 or 125 years, although we have witnessed longer and shorter terms in West Ham. Clearly, the term of lease left shortens over time. This is often overlooked and only raises itself as an issue when the flat or house has to be disposed of or refinanced. The shorter the lease the less it is worth and the more it will cost to procure a lease extension. Eligible long lease owners in West Ham have the right to extend the lease for an additional ninety years under statute. Please give careful attention before delaying your West Ham lease extension. Holding off that expense now likely increases the price you will eventually incur to extend your lease
It is generally considered that a property with more than 100 years unexpired lease term is worth roughly the equivalent as a freehold. Where an further ninety years added to any lease with more than 35 years left, the premises will be worth the same as a freehold for many years ahead.
| Lender | Requirement |
|---|---|
| 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; |
| Leeds Building Society | 85 years remaining from the start of the mortgage. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Virgin | 85 years at the time of completion. If it's less, we require it to be extended on or before completion. |
| 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 freeholder in West Ham,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with West Ham valuers.
Callum owned a high value apartment in West Ham being marketed with a lease of fraction over 61 years outstanding. Callum informally approached his landlord being a well known local-based freehold company for a lease extension. The landlord was prepared to give an extension on non-statutory terms taking the lease to 125 years on the basis of an increased rent to £125 annually. Ordinarily, ground rent would not be due on a lease extension were Callum to invoke his statutory right. Callum obtained expert legal guidance and secured an acceptable deal without going to tribunal and readily saleable.
Last March we were approach by Mr and Mrs. C Watson , who purchased a one bedroom apartment in West Ham in August 2012. We are asked if we could approximate the compensation to the landlord could be to extend the lease by an additional years. Comparative premises in West Ham with an extended lease were worth £250,000. The mid-range ground rent payable was £50 collected every twelve months. The lease ended in 2095. Given that there were 69 years left we estimated the compensation to the landlord for the lease extension to be between £9,500 and £11,000 not including legals.
An example of a Lease Extension matter before the tribunal for a West Ham residence 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 was in relation to 1 flat. The unexpired residue of the current lease was 69.77 years.