If you are thinking of extending the lease on your flat or leasehold property there is some useful information you should be aware of:
Did You Know? There are 2 very important dates to remember if you own a leasehold flat. The first is 80 years; if there is less than 80 years to run on a lease the landlord is entitled to half of the potential increase in the value of the property as a premium when the lease is extended. The second is 70 years; there are fewer mortgage lenders prepared to lend when a leasehold property has 70 or less years to run on its lease. This means that you might struggle if you wish to re-mortgage, or, if you want to sell, are likely to be restricted to cash buyers who don’t need a mortgage.
Did you Know? If your landlord seems to have disappeared, it is still possible to extend the lease of your flat. The process involves an application to the County Court for a vesting order and an application to the First Tier Property Tribunal for a determination of the price to be paid and the terms of the new lease. The County Court will need to be satisfied that all necessary steps have been taken to find the landlord.
Did you Know? If you have owned your flat for more than two years and then change the ownership of the flat to you and your partner or spouse you cannot claim a right to a statutory lease extension until you and your partner or spouse have been registered as joint owners for at least two years, irrespective of your previous sole ownership.
Did you know? If you are buying a flat and do not want to wait until you have been registered as owner for two years before claiming the right to extend the lease your seller can claim the right – assuming he or she is qualified to do so – and assign the benefit of the claim to you upon completion of the purchase, so that you can complete the lease extension process. If you are getting a mortgage to buy the flat this will be subject to your mortgagee’s agreement for the purchase to complete before the lease has been extended.
Whether you are a freeholder who would like to know more about this subject generally, or you have received a notice of claim from a leaseholder and would like specific advice, Judith Winward will be pleased to help you. She is experienced in acting for both landlords and leaseholders in statutory lease extension claims and works closely with our Residential Property team in this complex area of law. She can be contacted on 01206 217039 if you would like to speak to her or make an appointment to see her.
The information on this page relates to leasehold flats. If you own a house on a long lease and cannot afford to buy the freehold you may be entitled to extend the lease by 50 years under the Leasehold Reform Act 1967. There is no premium to be paid to the landlord but your rent is likely to increase.