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How To Negotiate Lease Extension | Trick Revealed

So, you’ve finally found a place you’re comfortable with. The neighborhood is good, no leaking pipes and no creepy noise are coming from the walls at night, and just when you thought it couldn’t get any better than this, you realize that your next rent review is only around the corner, potentially threatening your idea of settling down for a bit. Now that will make you think about how to negotiate a Lease Extension so you can still retain your property while spending less on the cost of a  Lease Extension.

But don’t worry. Not everything has to be sad and gloomy. At LeaseholdValuations.com we hold your hand through the complicated lease extension maze and keep you up to date along the way, making the whole process much less stressful and run smoothly.

If you don’t know how much does it cost to extend a lease, there are various ways you can find that out, which we will discuss further.

When do you negotiate?

There are two ways you can approach this.

  • You could take the traditional approach where the leaseholder serves the Section 42 Tenant Notice, which is followed by the Section 45 Counter Notice from the freeholder where they usually decline the amount suggested and put forward their premium. Negotiations happening at the Section 45 Notice stage involve solicitors, surveyors, and additional expenses that they bring with them.
  • You could choose the alternate method where negotiations happen before the leaseholder serves the Section 42 Notice. In this case you’re in direct contact with the freeholder or the management company, you can directly write to them stating your intentions of extending the lease and see if they’re open for negotiation. This saves costs that you would normally pay solicitors or surveyors at the Section 42 stage.

At this point, they would either agree to your terms or present you with their own offer, which you can compare with our online valuation calculator. If they end up ignoring you, you still have the option of taking the traditional approach and serving them the Section 42 Notice.

You may serve your own Section 42 Notice, but it is a good idea to instruct a solicitor to do it for you because serving a Section 42 Notice is critical, and any errors can allow the landlord to apply to the court to have it dismissed. 

RICS Valuation

Get an RICS Lease Extension Valuation before serving the Section 42 Notice because specialist RICS surveyors can perform a precise valuation of the property and give you a good estimate of how much you should be willing to offer the freeholder to extend the lease while staying in the confines of the Leasehold Reform Act. 

Using an online Lease Extension Calculator

There are ways you can calculate your premium online using an online Lease Extension Calculator, which can give you a rough idea of how much the premium is going to set you back. But remember, it only gives you a rough idea because the calculator will give you an amount depending on what data you have input. The freeholder has the right to raise an argument that you are not qualified to value the property and to give any offers based on your valuation.

In circumstances where you do proceed with serving a Section 42 Notice based on a value obtained from an online calculator, the freeholder may ask you to still get the leasehold valuation performed from a qualified RICS Surveyor. This may again add cost to your budget, so proceed with caution.

Open up a dialogue as soon as you can

It is a good idea to establish direct contact with the freeholder and work out a deal that works for both of you. Start discussing your terms early on because the earlier you begin a conversation, the more time you have to convince the landlord and also find out if the landlord is amenable to a deal or not. Get in touch with them directly and try something like, “I have received an online valuation which shows that the premium should be less than you are offering. Can we discuss this and find something that we are  both happy with?” This can open up your opportunity to discuss your terms with the landlord.

Establishing contact with the freeholder before serving the Section 42 Notice will open up a discussion and will give the freeholder an idea of the kind of premium that you have in mind. Depending on their response, you can judge whether they are willing to bend or not. This can help you further down the line when finalising the deal.

This might not help if the freeholder you’re dealing with is a large company because they usually only respond to formal notices to extend the lease.

Serving a Section 42 Notice

Based on how your pre-section 42 notice negotiation goes with your freeholder, you may now ask your solicitor to serve a formal Section 42 Notice for a lease extension. However, keep the following points in mind before including an amount in the offer.

a) Don’t offer too low: If you offer an impractically low amount, the freeholder may outright reject your offer and claim that your offer is invalid due to it not being “bonafide” or “realistic” So, choose an amount that’s reasonable, and that gives some room for a discussion

b) Don’t offer too high: Obviously, the freeholder is looking for the highest amount possible, and by offering an amount that is too high, you’re leaving no room for negotiation. Consider this a missed opportunity to settle on a reasonable premium.

The best way to go about this is by putting forward an offer that is somewhere in the middle of the lowest and the highest premium received from the surveyor’s valuation.

Receiving a Section 45 Counter Notice

If the freeholder accepts your offer, it’s all sorted. But if they don’t accept the offer, they will propose a revised counter-offer, which will be contained in the  Section 45 Counter-Notice. Now depending on how much different the Counter-offer is and how much you’re willing to deviate from your original offer, there are two possibilities.

If the counter-offer proposed by the freeholder is not significantly different from your original offer and is not setting you back by a huge amount, you may proceed with finalizing the deal. Also, if the difference in the amount is not worth spending extra money on your surveyor for negotiating with the freeholder, you may accept the offer and close the discussion.

If you feel the difference amount is too high, you can get your surveyor to negotiate your lease extension. The negotiation will take place between your surveyor and the freeholder’s surveyor to reach a common ground while comparing both their valuations. Remember that the hourly charges for negotiations are remarkably high, and you may end up paying more money for negotiating than the actual difference in premium. So, compare them wisely before going ahead.

So, consider your budget, what exactly you can afford, and how far you’re willing to go to turn the deal in your favor.

Contactless Lease Extension During Covid-19 Situation

Lease extensions are a daunting task even in the best of circumstances with various strict deadlines in terms of notices and counter-notices, agreement to the premium and specific terms and completion of the documentation procedures. Lease extensions made outside the statutory route may proceed a little more quickly than when carried out under the Leasehold Reform, Housing and Urban Development Act 1993, but it is a complicated process nevertheless. Considering all that, a global pandemic further increases the uncertainty to an already challenging task.

Valuations during Covid-19

Irrespective of whether you’re following the statutory route or the voluntary route for your lease extension, it is a good thing to obtain a valuation report from a lease extension specialist surveyor. This valuation report can be prepared by the surveyor either after a physical inspection or from a Desktop Valuation. Needless to mention, desktop valuations have been unaffected by the pandemic situation.

Desktop Valuation is an assessment that is conducted remotely through resources that are available online and completely eliminates the requirement for a physical inspection. It is helpful for people who are unable to arrange access to the property for the surveyor or in case there are time and budget limitations. However, it is important to note that Desktop Valuations are an open-market appraisal of the property that are derived only from information and tools from online sources and can provide an estimate of the market value from a combination of information and experience since there is no physical inspection involved. On the other hand, Desktop Valuations can be completed quickly without the hassle of arranging access to the property and cutting down the time required for the physical survey.

But lately, the housing market has been unlocked with strict government guidelines, which means physical inspections can be carried out as long as everyone follows strict measures to ensure safety, such as following social distancing and good hygiene measures. A physical survey is an advisable option, provided the inspection can be carried out safely with all the protocols in place and provided you’re not self-isolating.

However, if you prefer not to risk somebody being in your property or are self-isolating then you can always opt for a desktop valuation, which can be just as accurate as a physical inspection, as under the law there are certain things the valuer must assume about the internal condition of the property and so does not necessarily need to physically inspect your property.

What should you expect during your valuation?

In order to keep up with the latest government guidelines concerning the Covid-19 situation, a few extra points need to be taken care of by the surveyor as well as the occupants to permit a safe and smooth inspection.

  • The surveyor will ensure that nothing has been changed since the appointment was booked
  • If anyone is self-isolating in the household, has been diagnosed with Covid-19 or is showing any symptoms, the surveyor will not be able to carry out the inspection and it has to be booked for a later date
  • If possible, it is safer for both you and the surveyor if you’re able to leave the house during the survey. Otherwise, you may wait in the living room while the surveyor completes the inspection. If none of this is possible, please follow the surveyor’s instructions as and when they ask you to move so the inspection can be carried out easily
  • The Surveyor will start by inspection of the outside front of the house then move to the outside rear. Following that they will move on to sides, outbuildings, garages, then completing the inside of the loft, upstairs, downstairs hall, ground floor WC and finally the living room
  • All lights must be on to reduce contact with switches
  • All internal doors, loft hatches as well as garage doors must be kept open to prevent physical contact with doors and handles
  • Social distancing measures of at least 2 metres must be maintained and any kind of physical contact should be avoided. No handshakes must be exchanged and the surveyors must be equipped with the appropriate PPE
  • Other government guidelines specific to your part of the country must also be followed

The damage inflicted by Covid-19 has been massive and is yet to be evaluated, but at the same time, it is important now, more than ever, to plan ahead and ensure that our financial positions are such that we can be prepared for such unforeseen situations in the future.

For the safety of everyone, Leasehold Valuations must be carried out with all protocols and frequent hand washing and good hygiene must be encouraged.

Factors Affecting Lease Extension Valuation in UK

If you own a leasehold property in UK and now it is the time to extend that lease, then you should be aware of the factors to be considered while estimating the cost of the lease extension. If you don’t have enough information and need guidance regarding the lease extension process or related aspects, you can reach out to our chartered surveyors. In this blog, we will take you through each factor that plays a vital role in lease extension valuation in UK
Length of the Lease: Duration of the lease not only affects the property’s value, but it also affects the cost to be incurred in extending the lease. If the lease is not extended before its length falls below 80 years, the leaseholder needs to pay a higher amount for the lease extension. In addition, lenders tend not to want to lend mortgages on such properties.
Current Market Value of your Property: This can either be the current market value of your property with the current short lease or the value with a longer lease (ie after the extension has been completed).
Location of property:  wherein the UK your property is located does have a bearing on the calculation. This is because property values in different parts of the UK grow at different rates and this is reflected in the Deferment rate applied in your calculation.
Ground Rent Payable:  the ground rent you pay throughout the term of the lease is important as the landlord must be compensated for losing this income stream once you have extended your lease (as your ground rent will decrease to Zero)
At Leasehold Valuations, we deliver the services that you can rely on. So, contact our chartered surveyors today to see how much it will cost to extend your lease.

How to save money on a lease extension?

A lease is a legal document signed by the leaseholder as well as the landlord that allows the leaseholder to occupy the property for a particular time period, as specified in the lease agreement. This document includes certain essential terms and conditions – like ground rent payable by the leaseholder, responsibilities to be fulfilled by the landlord, etc. On the other hand, a residential lease is granted for a specific time period. At the end of this time period, the property reverts to the landlord. From the moment a lease is granted, the term immediately begins to get shorter, and therefore, it is necessary for you to get it renewed within time to enjoy uninterrupted possession of the property as well as to maintain the value of the property. After setting a clear understanding of the terms, rules, and conditions mentioned in the contract, both the parties show their consent by self-attesting the lease contract.

While talking about how to save money on the lease extension, the best and only way is to get it renewed before the lease length falls below 80 years. Though the request for the lease extension can be processed with a short time period left on a lease too, the cost will be very high in comparison to the cost that would be paid with the lease length above 80 years.

For Calculating the actual lease extension cost along with identifying the measures to save money on a lease extension, you can rely on the Leasehold Valuations’ team of qualified surveyors. Our experts have recently completed a couple of lease extensions where the type of property and the capital value were quite similar; still, the cost of both the lease extensions was dramatically different. The reason behind the difference was the lease length, where one property’s lease length was 81 years, the other one had only 63 years, and therefore, the cost of lease renewal for the first property incurred £5,000 and £18,400 for the second property.

“This scenario highlights the significance of lease renewal within the right time frame, especially when you want to sell the property in the near future and expect to receive the maximum market value.”

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A complete guide for the lease extension

This guide of lease renewal will help you comply with the requirements under the Leasehold Reform, Housing and Urban Development Act 1993. In this post, you will get to learn about some basic tactics to follow in order to extend the lease while saving money. This act provides the right to the leaseholders to extend the lease by a maximum of 90 years in addition to the number of years left on the existing lease. The only key requirement you need to fulfill to avail the benefit of this act is you must have owned the property for more than 2 years and hold an existing long lease that was originally granted for more than 21 years.

Marriage Value – the 80-year rule

It is recommended to extend the lease as soon as possible because the delay will only result in increasing the cost. According to the Act mentioned above, once the lease period falls below 80 years, the cost for the extension starts increasing rapidly, thus, if you are planning to sell the property in the future and want the maximum return on your investment, you should get the lease renewed within the time frame. Moreover, the moment the lease period declines below 80 years, an additional marriage fee is payable which also increases alongside all other costs.

Furthermore, the lease is an instrument that adds value to the property if extended within the timeframe, otherwise, creates a negative impact on the property’s value. Therefore, if the lease on your property is below 80 years, then the landlord is entitled to half of the increased share of the property’s value. Marriage value is only applied to those properties whose lease falls below 80 years and this is the primary reason you should always look to renew your lease before it reaches 80 years.

Lease renewal procedure as per the Leasehold Reform Act

You should be aware that you are only responsible for reasonable costs like – legal fees and valuation costs incurred by the freeholder in addition to your own legal and valuation fees during the entire process. The calculation of a lease extension cost is a complex process, thus, you should consult with an expert to carry out the valuation on your behalf under the 1993 Act. The lease renewal cost is also known as the premium and it is calculated on the basis of what the landlord is going to lose after granting the lease extension. With reference to this factor, the surveyor you will appoint will help you design your opening offer premium while serving the Section 42 notice to the landlord. From there, formal proceedings start and the final premium is decided either through formal negotiations or failing an agreement through the Tribunal.

If your lease time period is also running low and  it is going to fall below 80 years, you should take a step towards a lease extension. To find effective ways to save costs on the lease renewal, contact Leasehold Valuations today.

How to extend the lease of a flat?

Anyone who owns a leasehold property should bear in mind that the lease should be extended before the length of the lease starts shrinking too low. The length of the lease and the cost to be incurred in extending the lease, are inversely interconnected and so as the lease term reduces the cost to extend it increases. We are going to explain certain steps to be followed to extend the lease of a flat.

How do I get a new lease granted for my flat?

As each year passes on your lease, the value of your flat/property diminishes. Therefore, it is recommended to extend the lease as soon as possible because once the lease length falls below 80 years, you need to pay an additional amount for its extension. Mortgaging or remortgaging also becomes difficult when less than 75  years are left on a lease and it may become the reason for your inability to sell the flat. All such factors also decrease the value of the flat.

How can I extend the lease of my flat?

The residential lease extension process is rather complicated and thus, it is recommended to consult an expert who could guide you in the right direction and bring in the best possible results. Otherwise, a small glitch can become very costly in terms of money as well as time.

Apart from consulting an expert, the next thing you should do is serve a Section 42 notice to the landlord and any other intermediate landlord, including your offer for the premium. In return, the landlord will respond with Section 45 notice that includes the counter offer. Eventually, both parties agree on a price to extend the lease. If either of the parties does not agree on the terms and conditions, they can apply to the First-tier Tribunal to decide on the premium amount.

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Can the landlord refuse to grant the extension?

Provided that the leaseholder and the property qualify and a valid notice has been served under the Leasehold Reform Act 1967 or the Leasehold Reform, Housing and Urban Development Act 1993, then the freeholder is obliged to extend the lease.

The landlord must serve his response within a couple of months from the date the section 42 notice was served by the leaseholder, or else the leaseholder is able to apply to the First tier Tribunal to extend the lease for the price stated in the notice.

Qualification for a lease extension

Before executing the procedure and all other formalities, one must qualify for the lease extension. Here are some of those requirements for the qualification:

  • Own an existing long lease which was originally issued for a term of at least 21 years
  • Owned a flat for a minimum of two years

How long can I extend the lease of my flat?

The lease can be extended by 90 years made under the Leasehold Reform, Housing and Urban Development Act 1993. Alternatively, the leaseholder and freeholder can mutually agree without the need to serve any legal notices. However, under this scenario the freeholder has a stronger bargaining power.

What is the best time to extend the lease?

The lease should be extended ideally with more than 80 years remaining. That means the length of the lease should be a minimum of 80 years.Otherwise, the cost of the lease extension increases rapidly.

How much I have to pay to extend the lease?

The cost to extend the lease depends on multiple internal as well as external factors, including the property size, type, the number of years left on the lease, freehold value of the property, and the annual ground rent; therefore, it is very hard to define a particular amount.

Calculating the cost for the lease extension is considered a complex process, and it is therefore recommended to go for professional valuation services by an expert who complies with the requirements of the Leasehold Reform Legislation.

The Lease Extension Guide, Costs and Procedure

If you already own a leasehold property or planning to buy one, then this leasehold extension guide is for you. It is very crucial for you to gain adequate information about the lease extension process and your legal rights in order to make the informed decisions for the property and save a thousand pounds.

Let’s discuss what is a lease extension?

A lease extension is simply a process to add some years to your existing lease of your leasehold property. A Leasehold property is not owned outright. It is owned by the freeholder but your lease gives you the right to own it for a fixed period of years (the term of your lease). Once your lease expires the property reverts back to the freeholder and you no longer have any rights to the property.

Once the original lease has been agreed the leaseholder is liable to pay annual ground rent that is set out in the lease document.

Now let’s discuss what is a lease?

A lease is an agreement between you (leaseholder) and your landlord (freeholder). The lease can be for any number of years but is usually between 21 and 999 years long. The lease contract includes rules, regulations, rights as well as obligations of the leaseholder as well as the freeholder.

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Does the length of lease affect the property’s value?

Yes, the duration of the lease affects the property’s value. The primary reason behind this is the number of years left before lease expiration. The lower the number of years , the lower will be the value of the property and the sooner the property will revert back to the freeholder. However, you as a leaseholder have the right to extend the lease, but when the lease is near to its expiration, getting it extended becomes very costly. Furthermore, The lower the number of years the harder it can get to get a mortgage from a bank.

When is the perfect time to extend your lease?

There is no perfect time to extend the lease, however, the lower the length of the lease, the more expensive it will be to extend. Therefore, you should take appropriate steps to extend it sooner rather than later. But there is a point where leasehold renewal becomes really significant and that is at 80 years. The moment your lease  falls below 80 years, the cost of the lease extension will start increasing. This is because at this point the leaseholder has to pay an extra amount known as marriage value on top of the lease extension premium.

How to calculate the cost to be incurred on lease extension?

The process to lease extension  is defined under Scheduled 13, Part II of the Leasehold Reform, Housing and Urban Development Act, 1993. The premium amount is payable to compensate the landlord against the reduction in the value of the interest in the property as he will have to wait longer to regain control of his property In order to determine the cost of a leasehold extension, the following factors need to be considered, however, these are not limited to the following:

  • Current market value of the property
  • Number of years left in the lease extension
  • Ground rent payable
  • Value of the property after the lease is being extended

The best way to extend your lease is to get a Chartered Surveyor to value the premium for you. Although, there will be a fee payable, you will get the best advice and the adequate guidance to extend the lease at minimum cost and without any complications. At LeaseHold Valuations, we Provide professional service and walk you through the process in order to make this process less painful and to get you a better deal.

What is Leasehold Property and why does it Matter?

Most of the people are aware of the terms like renting a property and owning the property, but very few know what a leasehold property is, how to go through the lease extension valuation process, etc. Under  leasehold ownership, you lease (rent) property for a long period, often for 90 or 120 years or even 999 years, unlike rent agreements which are mainly for a year or two.

  • A leaseholder has a contract with the freeholder that sets down the legal rights of either side.
  • The freeholder is mainly responsible for maintaining the common parts like – hallways, corridors, walls, roof, staircase, gardens etc.
  • Leaseholders are responsible for paying an annual maintenance or service charge along with their share of the building insurance.
  • Leaseholders are liable to pay rent of the leased property on a monthly or yearly basis to the freeholder.
  • leaseholders are required to obtain permission from the property owner for any major alterations to their property.
  • In any case, if leaseholders fail to pay the amount stated in the contract, the lease can be forfeited.

Although a lease is for a very long time it will reduce over time and therefore, there will come a time when the lease length will need to be extended. leasehold property valuation, the extension of leasehold property, So, what is the benefit of extending your lease?

Let’s discuss in detail whether a leasehold property is a right fit for you or not:

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How does a leasehold property operate?

With a leasehold agreement, the property owner, who is also known as the freeholder, grants  permission to the leaseholder to live in the particular property for a particular time period. During this time (known as “Term”) the leaseholder is required to pay the freeholder a rent (known as “ground rent”) usually on a quarterly, six monthly or annual basis. The advantage of owning a leasehold property as opposed to renting one (on as Assured shorthold basis) is that the leaseholder  can improvise or modify the property according to their needs because the lease is for a long span of time.

Leaseholders can even sometimes renovate or build a whole new building on the land and rent separate units. At the end of the lease, the property must be returned to the freeholder

Benefits of a Leasehold Property

  • There are a few noteworthy benefits for the potential owner with regards to the leasehold properties such as leasehold properties are less expensive compared to the purchase of the freehold.
  • Furthermore, the leaseholder can sell the same lease to a third person even without taking permission from the property owner.

How do I know whether my property is leasehold or not?

If you are unsure that your property is leasehold or not, you should ask your solicitor or directly ask the property owner. Previously, leaseholds used to be aligned with flats, however, now newly built houses, as well as the buildings are sold as leaseholds too. In England, almost 4.2 million homes are registered as leasehold apartments and most of them are newly constructed city apartments. However, the UK government has intervened followed by banning the ‘unjustified use of leasehold in new-houses’.

What happens when the lease ends?

The moment your lease period will end, the property owner will again own the property, regardless of the amount you have paid during the lease period or you have paid the mortgage amount in full. That means that even if you were living in that property for a very long period, let’s say for 80 years,  you will not  have anything to show at the end of the lease.

How can I extend the leasehold period?

There is legislation which protects the leaseholders’ interest. Providing the original lease was for a minimum of 21 years then you can extend it for 90 years more. Moreover, if you live in a house and it is a leasehold property then, you have the right to extend the lease for 50 years, while following certain conditions.

At LeaseholdValuations, we can help through this minefield to extend your lease.

 Don’t struggle and talk to our experts now!

A complete guide to choose an expert to evaluate the value of your leasehold extension

Leasehold extension is a bit of a lengthy and complicated process that includes cost estimation and getting the right expert to take care of every single step engaged in the lease extension process while avoiding every possible pitfall. Therefore, if you are also considering extending the lease, then probably the first question that comes in your mind is ‘How much it will cost?’ Unfortunately, it is not at all possible to estimate the exact cost to be incurred in extending the lease at the beginning of the process. Hence, let’s discuss this in brief:

Who can apply for a lease extension?

To apply for lease extensions, homeowners must:

  • Own a lease, which was originally granted for  at least of 21 years in length ; and
  • Have owned the property for a minimum of 2 years;

There are a few exceptions such as commercial or business leases as well as the properties which are a part of a charitable housing trust.

How to calculate the value of leasehold extension?

The cost of a leasehold extension depends on  multiple factors such as the value of the property, the annual ground rent, the number of years left on the lease and the ground rents payable during the term of the lease Therefore, it is necessary for you to contact an expert to calculate the value of the residential lease extension.

How to choose an expert and why you should consult one for leasehold extension?

The legal procedure around the leasehold extension is complicated and thus, requires an adequate understanding of the laws and regulations surrounding leasehold enfranchisement to manage the process successfully. As this area of law is a minefield, you will require an expert who can assist you at every single step along the way  

The residential leasehold extension surveyor will help you produce a valuation report, which will calculate the premium payable for a lease extension. Every leasehold extension has numerous debatable variables and only an expert with the experience in leasehold law can be able to handle such debates and negotiate on your behalf. Now the question arises, how to choose an expert who could help you calculate the value of the leasehold extension? The answer to this question is:

  • You should choose an expert who has sufficient knowledge of leasehold law and other related  rules and regulations
  • Check whether the specialist you are going to hire is competent to estimate the local property values or not
  • Check the expert’s previous experience including  the following:
    • Is the expert a member of the Royal Institution of Chartered Surveyors (RICS)?
    • Does the expert have a clear fee structure or not? (does he charge on hourly basis or project basis)
    • Does the expert have enough knowledge about the geographical location of the property?
    • Does the expert have an online presence and has an active website?
    • Does the expert clearly and effectively communicate with you?
    • Is the expert ready to provide evidence before a Tribunal?
    • How many times the expert has appeared at a Tribunal?
    • Does the expert mainly act for freeholders or leaseholders?

The role of chartered surveyor for the lease extension

The above mentioned points already describe the significance of professional advice and consultation in the lease extension process. Let’s throw light on the role of chartered surveyor for lease extension:

An expert should be able to:

  • Evaluate the value of the leasehold extension in line with schedule 13
  • Help you know how much to offer landlord in the tenant’s notice
  • Help you know how to respond to the landlord’s counter notice
  • Negotiate on your behalf with the landlord

Therefore, it would be strongly advisable  for you to appoint an expert to extend your lease because a valuation surveyor should  have good knowledge of the leasehold law and local property market. Moreover, we have come up with a chronology of steps to execute to make the leasehold extension process easy and effective:

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Step 1: Appoint a chartered surveyor for lease extension who is a member of the RICS

Step 2: Ask your solicitor to serve a formal notice on your landlord based upon the valuation received by your surveyor  

Step 3: Once the counter notice is received from your landlord ask your surveyor to negotiate the premium payable.

Step 4: Once the premium has been agreed, ask your solicitor to complete the new lease.

At Leasehold valuations, our specialists handle a large number of lease extension cases in the UK every year. Hence, we are familiar with such cases and can help you make the most of your hard-earned money while making the lease extension process transparent and hassle-free.

What is the difference between lease renewal and lease extension?

Most people, who are at the end of their lease term, encounter two words that seem to mean the same – extension or renewal? Many people, including judges and some professionals, confound this term as a lease extension with a lease renewal. Almost all leaseholders have the right to extend the lease term beyond the end of the initial term. In this article, we will describe whether there is a difference in these options

In very basic layman’s language lease renewal is a new lease but with the majority of the terms remaining the same. There may be some changes though, for example, to modify the lease terms. Lease extension is used to mean that you are extending the term of your lease (perhaps by the statutory 90 years or some other length) with the main terms of the lease remaining intact. However, even in lease extension you can alter some terms. So in essence, lease renewal and lease extension are the same thing (as far as leasehold valuations are concerned) but some people use the two phrases interchangeably.

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A lease extension still requires a completely new lease to be drawn up although in most cases the only thing that is changing is the end date of the lease.

The parties need to sign a brand-new lease from a legal perspective in order to renew a lease. A lease extension extends the term, which usually includes the terms of the existing lease.

If you’re left with around 83 years on the lease-end period we would certainly suggest that you look for more professional and legal advice. As with an expert solicitor, you will get help to decide what you should do to renew or extend your lease.

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