If you own the lease of a flat you must realise that your lease is constantly decreasing in value but there is something you can do about it.
The Leasehold Reform Housing & Urban Development Act 1993 gives most leaseholders a right to extend their lease by 90 years and above the current unexpired years remaining on the lease. The following questions and answers will help you understand your rights.
Q. If I apply to the freeholder for a new lease could the freeholder say “no”?
A. If you serve a valid notice under the Act your freeholder must extend your lease.
Q. What do I do if my freeholder asks for a ridiculous high price?
A. The Act sets out the formula for the price you must pay to extend your lease – it is not for the freeholder to decide the price. If the parties cannot agree, the premium is decided by the Leasehold Valuation Tribunal.
Q. What if my freeholder increases the ground rent under the new lease?
A. After you extend your lease the ground rent will be reduced to a peppercorn which effectively means nothing.
Q. I have 85 years left on my lease can I exercise my right at a future date?
A. If there are fewer than 80 years left on your lease you will have to pay a larger premium than if you apply to extend your lease which there are 80 years or more remaining.
Q. What if I am a landlord?
A. If a tenant serves a valid notice on you, you cannot afford to ignore it – it will not go away. If you do not serve a counter notice within the stipulated time you will have to extend the tenant’s lease at the price stated in the notice.
Leon Kaye Solicitors are able to offer expert legal advice on lease extensions, please contact them on 020 7228 2020 or 020 7095 0930 for further information or email them at email@example.com