It’s an underpublicised truth that a Dagenham 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 early years due to the deflation being disguised by increases in the Dagenham property market.Where your lease has approximately 90 years left, you need to start considering a lease extension. If the number of years remaining dips under eighty years, you will end up paying half of the property's 'marriage value' on top of the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property The majority of flat owners in Dagenham will be able to extend under the legislation; however a conveyancing solicitor will be able to confirm whether you are eligibility. In some cases you may not be entitled. There are also strict deadlines and procedures to be adhered to once the process is instigated and you will need to be guided by your lawyer throughout the process.
It is generally accepted that a property with over one hundred 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 equivalent in value to 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; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Coventry Building Society | 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. |
| 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. |
Lease extensions in Dagenham can be a difficult process. We recommend you procure professional help from a lawyer and surveyor with experience in lease extensions.
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 in-depth market knowledge dealing with Dagenham lease extensions and further afield, as well as any potential issues which may arise as well as problems with the Leasehold Valuation Tribunal.
Off the back of lengthy discussions with the freeholder of her ground floor apartment in Dagenham, Kelsey initiated the lease extension process as the 80 year deadline was quickly nearing. The lease extension was finalised in July 2011. The freeholder’s costs were kept to an absolute minimum.
Mrs J Gray took over the lease of a basement apartment in Dagenham in April 2003. We are asked if we could shed any light on how much (approximately) price would be for a 90 year lease extension. Comparable residencies in Dagenham with an extended lease were valued about £189,000. The mid-range ground rent payable was £55 billed per annum. The lease elapsed on 17 September 2079. Given that there were 53 years outstanding we estimated the compensation to the landlord for the lease extension to be between £28,500 and £33,000 exclusive of professional charges.
An example of a Lease Extension decision for a Dagenham property 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 term was 61.36 years.