UK leasehold extension has several benefits that any owner of a leasehold flat should definitely think about. The whole process of getting your lease extended might seem a bit daunting at first, but it is definitely worth it. What’s more, it’s even better if you start the process of lease extension as early as possible as this can bring you even more benefits – particularly in terms of cost. This article looks at three of the top benefits of extending the lease on your flat as soon as you can.
Extend your lease and boost your home’s value
One of the main benefits of extending a lease is that it can boost your home’s value. Under the 1993 Leasehold Reform Act, you can force your freeholder to extend your lease by 90 years at a peppercorn rent (which means that you essentially won’t have to pay any more ground rent). This is significant as a longer lease will increase the value if your property. If you have a short lease, then as this decreases even further, so will the value of your property. A longer lease, by contrast, should mean that your property is worth the same or nearly the same as a comparable property where the freehold is for sale.
Alternatively you can choose to negotiate an informal lease extension with your landlord – but although this can work really well, there are dangers – so make sure you speak to one of our specialist team first before going down this route
Make your flat easier to sell with a lease extension
Another benefit of extending the lease on a flat early on is that it will make your property easier to sell. This is for two reasons. One is that is much easier to get a mortgage on a property that has a long lease, as lenders are often wary of giving out mortgages for properties with short leases. The second reason is that people are generally more attracted towards properties that have longer leases.
Save yourself money with leasehold extension
One last benefit of an extended lease is that it can save you money in the long run. This is because if your lease is for less than 80 years when you apply to extend it then it will cost more to do [Once your lease drops below 80 years, even if it is by just one day, your landlord can significantly increase the price, you must pay him to extend your lease – this additional charges known as the “marriage value”].
When you consider that you not only have to pay your costs but your landlord’s professional fees as well, it makes sense to extend the lease as soon as you possibly can – preferably before that all important 80 year cut-off point. This will help to keep your costs down while also maximising the length of your new lease, which will benefit you further in the long run when it comes to getting a good price for your property when you eventually choose to sell it.
Extending your lease – much easier than leasehold enfranchisement
If you’ve done a bit of research on the subject, you may realise that as an alternative to extend your lease, you can join together with other tenants in your block to purchase the freehold – a process commonly known as leasehold or collective enfranchisement. Buying your freehold enables you to grant yourself a 999 year lease on your flat and can make great financial sense – however whilst negotiating a lease extension is relatively straightforward, be aware that freehold enfranchisement is often a long, lengthy and difficult process and you need to keep a number of your fellow tenants on board throughout – and losing the support of just one of them can sometimes wreck the whole deal
Thinking Of UK Leasehold Extension?
If you’re thinking of extending your lease, or joining together with fellow tenants to buy the freehold of your block, make sure you get the right legal advice. Few solicitors deal with lease extension regularly – and that could be a danger. Rest assured our solicitors are specialists – we have dealt with thousands of lease extensions over the last 25 years. Although we are based in Salisbury we represent clients throughout the UK – taking instructions by e-mail, phone and Skype.
For FREE initial lease extension advice on the phone, and a FREE quote, either;
- Call us now on 0800 1404544, or
- Send us an email using the enquiry form below.
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