This third blog in a series of blogs attempting to explain in layman’s terms the process of extending your lease, whether for a flat or house. Please see our previous blogs in this series and also all other blogs which are intended to help you understand this complex piece of legislation.
How much does it cost to extend my lease?
There are 2 main fees payable in the lease extension process. One is to the surveyor and the other is to the solicitor. However, you as the leaseholder are legally obliged to pay also for your landlord’s “reasonable costs”. So not only do you have to pay your own surveyor’s and solicitor’s costs you also have to pay your landlord’s surveyors and solicitor’s costs. These costs must be “reasonable”.
Although fees vary across regions and firms a rough estimate for surveyor’s costs would be £700 – £950. We believe “reasonable” solicitor’s costs would be in the region £700 – £1,200.
What is the process involved in extending my lease?
The process for lease extension basically is as follows:
- You need to get a valuation so that you know what figure to enter in your initial notice to your landlord. The valuation is usually undertaken by a surveyor. Where an intermediate or superior lease is involved there may be an additional charge as this additional interest makes the valuation a bit more complicated.
- Once you have received your valuation, you need to instruct a solicitor to serve an initial notice on your landlord requesting the lease extension.
- Once this notice is served the landlord has 2 months within which to serve their counter notice stating at what price they would be willing to extend your lease.
- Once this notice has been served the surveyor then begins negotiations with the landlord’s surveyor in order to agree on a premium which will be payable to extend your lease. We have a time limit of 6 months in which to agree.
- Once the matter is agreed your solicitors will complete the extension.
What happens if the two surveyors cannot agree to a premium?
If agreement cannot be reached within 6 months, then either party has the right to apply to the First-tier Tribunal (Property Chamber) (formerly known as the Leasehold Valuation Tribunal) to have their case heard. A tribunal usually consists of 2-3 professionals with at least 1 surveyor and 1 legal professional both with relevant knowledge of the matters to be heard.
If the matter is referred to the First-tier Tribunal (Property Chamber) then additional fees will be payable.
The First-tier Tribunal (Property Chamber) is the court equivalent to property related matters.
The First-tier Tribunal (Property Chamber) will firstly issue directions, with strict timescales, to both parties on what they want each of their professional advisers (solicitors and surveyors) to do. If these timescales are not adhered to the Tribunal can take that into account when asked to award costs.
Each party therefore needs proper professional advice to guide them through this maze of regulation and, firstly, to try and avoid a full hearing (thereby saving costs for their clients) but also to fight their client’s case as vigorously as possible if a full hearing becomes necessary.
Some professionals will claim to know how to deal with leasehold matters when in reality they have very little experience or knowledge.
We, at Leasehold Valuations, have the knowledge, experience and much more to support you and will guide you through this process and the expertise to fight your case as vigorously as it deserves from initial valuation to the First-tier Tribunal (Property Chamber)– (if required).
Please refer to our case studies to see how successful we have been when we have had to go to tribunal and helped our clients achieve fantastic results, in some cases saving them over £1 million but in most cases saving them many thousands.
Please contact us for free, no obligation, advice. Call: 01753 542984 or use our Contact form.