Get advice on the process, start the formalities in the correct way and then negotiate with the freeholder in a nutshell, since most extensions do not require to be determined, in the sense of the premium payable, by a dispute going all the way to the Leasehold valuation Tribunal.
Solicitors who specialise in flats lease extensions are able to assist individuals with residential flat leases to extend their leases.
This area of law is very complicated and requires experienced solicitors and valuators to assist when extending a lease.
There are certain criteria that need to be met as well as exceptions.
In order for your lease to qualify the lease must be a long lease and must have been in possession for more than 2 years. As a result of this, where a lease may need to be extended, a buyer of a property where the seller has owned for more than 2 years may require the seller to start the statutory process, and then to assign the benefit of the notice to the buyer to circumvent a problem for the buyer who may complete an extension after purchasing.
Which leases are not eligible?
Leases that are not eligible include those running on a building which is on national trust property, or is in a cathedral district or is on Crown property.
Do I need to consult a solicitor and a valuer for a successful application to have my lease extended?
Yes, this is advised as extending a lease is a complicated process and errors in the procedure or in negotiating can prove very costly. Also, once the paperwork has been complete, there are technical requirements at the Land Registry so using a solicitor is definitely recommended.
It is often also necessary to instruct a valuer to come up with a suggested valuation for the extension and the freeholder will also almost certainly want their own valuer, which the leaseholder will have to pay for as well, so this should be factored into the cost, adding a possible further several thousand pounds.
When your assignment has been registered by the solicitor the leaseholder can serve the notice and sell the flat.
What is the benefit of extending a lease?
The main benefit to extending the lease is that you are creating more value in your property. A lease which has more time to run until expiry is worth more than a lease with only a few years to run.
The benefits are having a more economically valuable lease when wanting to sell it and not having to pay typically due ground rent on the extended term as specified by the Leasehold Reform Act 1993.
Why is the lease more valuable if it is longer?
If you are trying to sell your flat mortgage lenders will not normally represent you if the unexpired term is less than 60 years.
Also, the shorter the length of your lease the less valuable it is. This is because the buyer will not want to have to go through the precarious renewal process and face the undesirable chance of having to move. If the lease in question has more than one hundred years before it expires then the shortening of your lease will not matter.
What are particular points I should bear in mind when deciding whether to extend my lease?
When considering whether to extend your lease is, if it is less than 80 years in length you may have to pay a ‘marriage’ value to the landlord.
Valuation costs will also be necessary to specify a selling price of the lease.
For addition advice on any aspects of property lease law visit http://www.beingaleaseholder.co.uk