Silvertown leases on residential properties are gradually diminishing in value. The shorter the remaining lease term becomes, the less it is worth – and as a result any extension of your lease becomes more expensive. Most owners of residential leasehold property in Silvertown enjoy rights under legislation to extend the terms of their leases. If you are a leasehold owner in Silvertown you really ought to see if your lease has between seventy and 90 years remaining. In particular once the remaining lease term slips under eighty years, the cost of any lease extension sharply increases as an element of the premium you will incur is what is known as a marriage value
Leasehold premises in Silvertown with over one hundred years unexpired on the lease are sometimes regarded as a ‘virtual freehold’. This is where the lease is worth the same as a freehold interest in your home. In such circumstances there is often little to be gained by purchasing the freehold unless savings on ground rent and service charges merit it.
| Lender | Requirement |
|---|---|
| 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. |
| 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. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| 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 landlord in Silvertown,the lease extension solicitors that we work with will always be prepared to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Silvertown valuers.
Two years ago Ethan, came critically near to the 80-year threshold with the lease on his garden flat in Silvertown. In buying his property 18 years previously, the length of the lease was of no importance. As luck would have it, it dawned on him that he would soon be paying an inflated amount for Extending the lease. Ethan extended the lease just under the wire last September. Ethan and the freeholder eventually agreed on sum of £6,000 . If the lease had fallen to less than eighty years, the figure would have become more exhorbitant by a minimum £925.
In 2009 we were e-mailed by Mrs U Gray who, having owned a garden flat in Silvertown in September 2009. The question was if we could estimate the compensation to the landlord would likely be for a 90 year lease extension. Comparable properties in Silvertown with an extended lease were worth £254,200. The mid-range ground rent payable was £60 collected monthly. The lease came to a finish on 5 July 2077. Given that there were 51 years as a residual term we estimated the premium to the freeholder for the lease extension to be between £43,700 and £50,600 plus fees.
An example of a Lease Extension case for a Silvertown premises 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 residue of the current lease was 69.77 years.