Lease Extension Procedure
How to get started
The first step in extending your lease is to obtain a valuation of the likely premium payable to extend your lease. You will need to instruct a surveyor who is experienced in carrying out such evaluations. Your surveyor will visit your property and carry out an inspection.
Based on that inspection and a statutory formula he will provide you with an estimate of the likely premium payable for the lease extension. The surveyor will be able to give you a ‘top’ and ‘bottom’ figure so that you will have some idea of the range within which the lease extension premium will fall.
The bottom figure will be the figure proposed to the landlord in the statutory notice you will serve. The top figure is the figure which the landlord is likely to propose when he serves a Counter Notice.
The valuation is the first step of the procedure not least to give you an idea of whether you can afford to extend your lease.
You must bear in mind that you will be responsible for the legal and valuation fees of yourself and the landlord from the date of service of the notice, even if you subsequently withdraw from the process, and so it is important to ensure at the outset that you will be able to complete the process before you begin.
Once you have obtained your valuation and have an idea of the likely premium payable for your lease extension it will be necessary to serve a statutory notice on your landlord. We will prepare this notice on your behalf.
The notice must be signed by all registered owners of the flat personally. It is important to ensure the details in the notice are correct as any inaccuracies may lead to your notice being invalid.
Once the notice has been signed we will serve the notice on your landlord who will have 2 months within which to serve a counter notice either admitting or denying your right to the lease extension and indicating the premium he would be prepared to accept for the grant of a new lease.
Generally, your landlord will admit your right to extend your lease but will propose a higher premium.
Following service of the counter notice there will be a period of six months during which time each parties valuers will negotiate in an attempt to reach an agreement on the premium payable for the new lease.
If the valuers cannot reach an agreement on a price it will be necessary to make an application to the Leasehold Valuation Tribunal for the premium to be determined.
In addition to the premium payable for the lease extension, you will also be responsible for the legal and valuation costs of the landlord from the point of service of your notice until completion or withdrawal of your notice.
We will be happy to provide a breakdown of our fees on request [Quote Request for Lease Extension].
There are a number of exceptions which may prevent you from exercising your right to extend your lease. These exceptions are:-
- If you have a business lease
- If your landlord is a charitable housing trust and the flat is provided by the charity as part of its charitable work
- If your building is within the precinct boundary of a cathedral
- If your building is built on certain land held by the National Trust
- If your building is owned by the Crown
- If you have a shared ownership lease where the total share owned is less than 100%