What is a Lease Extension?
is granted to a
for a specific number of years.
At the end of that time, the lease ends and full ownership of the property goes
back to the freeholder. A lease extension increases the length of the original term
of the lease, and puts off the date when the freeholder takes back possession.
Why do I need to extend my lease?
As the term of your lease drops below 99 years, the value of your property may start to decrease. Once the
lease drops below the 80 year mark, it decreases in value faster and you may have
problems selling it, or obtaining a mortgage on it.
Why is it important to extend my lease?
Many mortgage lenders are requesting a minimum term of 70 years remaining at completion of a new mortgage – therefore extending the lease
may be essential when dealing with properties built in the 1960's and 70s.
How do I extend my lease?
Extending your lease is complex: you need a surveyor to value the property and negotiate
the terms of the extension and a solicitor to complete the legal work. Our aim is
to make this process simple for you by providing all the experienced professional
services you need under one roof to save you time and money and give you peace of
mind throughout the transaction. If you have already negotiated an extension with
your freeholder, we can provide a solicitor-only service.
Do I qualify to extend my lease?
All leaseholders have the option to negotiate an extension to their lease with their
freeholder. However, many residential leaseholders have a legal right to a 90 year
extension if they have owned their property for at least 2 years, own a lease which
was a long lease
when it was granted and the property is not in a small category
. If the property was part of a shared ownership scheme, you must own
Your freeholder is entitled to a payment for this extension, known as a premium,
which is calculated according to the terms of the lease, and the value of the property.
If you qualify for a
statutory lease extension, your freeholder can try to negotiate
the amount of the premium but he cannot avoid extending the lease and he cannot
use delaying tactics to increase the amount of the premium.
Do I have any other options?
If you do not qualify, or the premium for a statutory lease extension is too expensive,
it may still be possible to obtain a non-statutory lease extension
. You could choose
to negotiate a shorter extension and/or increased ground rent
to try to achieve
a lower premium. However, if you choose this option, your freeholder can't be forced
to agree to extend your lease and you may end up paying more for the extension in
the long run. This could happen through your freeholder spinning out the negotiation
process, while the term of your lease continues to fall, making the extension more
expensive, especially if the term drops below the crucial 80 year mark, so that
becomes a factor.
For more information please see the