| Under
the Leasehold Reform (Housing and Urban Development) Act 1993
tenants of long leases are given the right to extend their
leases. The right provided for by the Act is for the grant
of a new lease for a term of 90 years, plus the present unexpired
term, all at a peppercorn rent (that is, rent free) i.e. if
you had 33 years left to run on your lease you would end up
with a lease of 123 years after extension.
-------------------------------------------------------------
Click
here to find the new way to make long-term money online in
your spare time
-------------------------------------------------------------
The tenant is required to make
a one off payment of money to the landlord known as a “premium”
in return for the new lease. The process is initiated by the
tenant serving a notice on the landlord calling on him to
grant an extended lease.
As the number of years left on a lease decreases
a lease becomes harder to sell and it may be difficult to
raise a mortgage on the property. Most purchasers do not want
the hassle of extending a lease themselves so will expect
a substantial discount in the purchase price if they are to
buy such a lease. Extending the lease makes the property more
marketable.
The value of your flat is affected by the
number of years the lease has left to run. The underlying
value of the flat declines as the length of the lease reduces,
and more significantly once the lease falls below 80 years.
As a lease is always diminishing, it is a
significant 'wasting asset'. We can help you extend your lease
or buy your freehold so that your flat will once again achieve
its full market value.
Important facts to bear in mind -
Under 70 years - If your lease length is
below 70 years, your flat is becoming less and less appealing
to future buyers, as a number of mortgage lenders will either
not lend against flats with leases below this level or will
offer less favourable terms.
70 to 80 years - If your lease length is between
70 and 80 years, it is important to take action now, as the
cost of rectifying the problem is increasing exponentially.
Over 80 years - If your lease length is over
80 years, taking prompt action will avoid marriage value,
whereby the freeholder is entitled to 50% of any uplift in
value resulting from a lease extension or freehold purchase.
The longer you wait to address your lease
length, the more expensive it will become.
Extending your lease also provides you with the opportunity
to rectify defective clauses that can cause particular problems
with mortgage lenders.
What
is a Lease? |
Are
There Different Types of Leases? |
Extending
a residential lease |
How
do I extend the lease?|
How
much will it cost? | Lease
Extension |
Car
and Vehicle Leasing |
Example
of Lease Agreement |
Extension
of Short Leases on Central London Properties |
Rental
Challenges |
