Unfortunately that a Silvertown residential lease is a deteriorating asset. As the lease term diminishes so does the value of the property. The extent of this is not fully appreciated in the first few years due to the deflation being disguised by increases in the Silvertown property prices.Once your lease nears 85ish years, you need to start thinking about 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 lower than 80 years - otherwise a higher amount will be payable. Most flat owners in Silvertown will be able to extend under the legislation; however a conveyancer 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 be adhered to once the process is initiated and you will need to be guided by your conveyancer throughout the process.
Leasehold premises in Silvertown with in excess of one hundred years unexpired on the lease are sometimes referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your property. In such situations there is often little to be gained by purchasing the freehold unless savings on ground rent and maintenance charges justify 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. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
| 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. |
The conveyancing solicitors that we work with handle Silvertown 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 lawyer we work with provide it.
Two years ago Max, came seriously near to the eighty-year mark with the lease on his two bedroom flat in Silvertown. Having purchased his property 18 years previously, the lease term was of little bearing. Luckily, he noticed he would soon be paying an escalated premium for Extending the lease. Max was able to extend his lease just in the nick of time last August. Max and the freeholder ultimately agreed on an amount of £6,000 . If he not met the deadline, the premium would have increased by at least £975.
In 2009 we were contacted by Mr J Allen who, having took over the lease of a one bedroom apartment in Silvertown in April 2007. The question was if we could estimate the compensation to the landlord would be to extend the lease by an additional years. Identical properties in Silvertown with a long lease were in the region of £280,000. The average amount of ground rent was £55 billed yearly. The lease end date was on 7 November 2104. Given that there were 78 years left we calculated the compensation to the freeholder for the lease extension to be between £13,300 and £15,400 plus costs.
An example of a Lease Extension decision for a Silvertown property 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.