Lease Extensions

As a leaseholder, owning a flat with a long lease is a valuable asset. However, as the term of your lease gets shorter, the value of your property can significantly decrease. When your lease term drops below 80 years, mortgage lenders may refuse to grant potential buyers a mortgage, restricting your property’s marketability and value.

Extending your lease is a crucial step in maintaining the marketability and value of your property.

Why Consider a Lease Extension?

Preserve Property Value: As the unexpired term of a lease decreases, so does the property’s value. Extending your lease helps protect and potentially increase this value.

Marketability: Properties with longer leases are more attractive to potential buyers. A lease term well over 80 years is generally needed for full marketability.

Avoid Loss of Property: If a lease expires, the landlord has the right to reclaim the physical flat, resulting in the loss of the property for the leaseholder.

Routes to Lease Extension

There are two primary methods for extending the term of a lease:

The Voluntary Route – Negotiate and agree on extension terms directly with your freeholder/landlord. This approach is generally more straightforward and less time-consuming compared to the statutory route

The Statutory Route – Under the Leasehold Reform Housing and Urban Development Act 1993, as amended by the Commonhold and Leasehold Reform Act 2002. Once you have owned a leasehold property for at least two years, you are entitled to purchase an extension to the existing lease term by a further 90 years at a peppercorn ground rent. The premium payable for the lease extension is assessed by a surveyor.

What can we do for you?

Our expert team is here to guide you through both the voluntary and statutory routes, and can help with each of the following areas;

Eligibility and Advice: First, we check if you’re eligible for a statutory lease extension. We’ll explain the pros and cons of both statutory and informal routes, so you can make an informed choice.

Valuation: For a statutory lease extension, we work with qualified surveyors to get a precise valuation of the premium payable to the freeholder, ensuring you don’t overpay.

Serving Notices: If you go with the statutory route, we’ll serve the initial notice to the freeholder to officially start the lease extension process. We’ll make sure the notice is correctly formatted and includes all necessary details to avoid any issues.

Negotiation: Regardless of the route you choose, negotiations are part of the process. We will negotiate on your behalf to secure the best terms for your lease extension.

Drafting and Reviewing Documents: Lease extensions involve various legal documents. Our team will draft and review all necessary paperwork to ensure your rights are protected and the terms are clear and fair.

Completion: Once terms are agreed upon, we’ll handle the completion process, including registering the new lease with the Land Registry

Navigating the lease extension process can be daunting. Laceys not only offers legal expertise but also provides reassurance and support throughout, helping you feel confident and informed at every step.

If you’re considering a lease extension and need expert legal advice, please contact Mark Preece at m.preece@laceyssolicitors.co.uk or 01202 377862 to get started.

On 24th May 2024 the Leasehold and Freehold Reform Act 2024 was passed but many of its provisions have not yet been brought into force. The provisions of this Act, when brought into force at a date currently unknown, will change significantly the law relating to lease extensions.