Commonly Asked Questions & Answers

Q. How long can I extend my lease for?

If you have a statutory lease extension under the Leasehold Reform, Housing and Urban Development Act 1993, it will be extended by 90 years. It may be possible to extend your lease by other lengths but this would be by negotiation with your freeholder and would not be covered by the Act.

Q. Will my ground rent change?

If your lease is extended under the Leasehold Reform, Housing and Urban Development Act 1993, the ground rent will become a peppercorn until the lease expires. If the lease is extended informally without the protection of the Act, you may negotiate an increased ground rent, or agree to more ground rent reviews in return for your freeholder agreeing to the extension.

Q. I am thinking of buying a property with a short lease – what should I do?

You should take advice from your solicitor before buying. You can ask your seller to start the lease extension process before the sale, if they qualify. The law makes it possible for a buyer to take over the process if the seller has initiated the correct procedures, so you will not have to wait for 2 years to qualify yourself.

Q. I don't know who my freeholder is or how to find him; can I still get a lease extension?

Your solicitor will be able to advise you on the best way to trace your freeholder. Usually details can be found on ground rent demands. Sometimes, there may be more than one level above you in the chain – if for example your lease was granted by another leaseholder, sometimes called a head landlord who in turn was granted a lease by the freeholder. In such cases, it is usually possible to find all the relevant parties, but your solicitor may make an additional charge for this work, as it is not a standard part of a lease extension case, and therefore not covered by our quote. Your solicitor will tell you what those additional charges will be.

If your freeholder cannot be traced, then an application can be made to the County Court for the lease to be extended in the absence of the freeholder. You need to show that all reasonable efforts have been made to trace the freeholder. Although this work is also not standard, and therefore not covered by our quote, it may be a cheaper option in total, because the lease will normally be granted on the basis of the valuation in your Statutory notice, which will be lower than if a freeholder had put in a counter notice. Your solicitor will give you advice and an estimate of the additional charges, if this applies to you.

Q. What happens if I have to apply to a tribunal?

The Leasehold Valuation Tribunal has the power, in statutory lease extension cases, to decide the premium payable for the lease extension, if it has not been possible to reach agreement. Only a small number of cases reach this stage, the majority are dealt with by negotiation. If you do have to apply to the tribunal, your solicitor and surveyor can deal with this. However, this is not covered by our original quote, and you will be charged separately for this stage. Your solicitor and surveyor will tell you at the outset what their rates for this work will be.

Q. I own a leasehold house - can I extend my lease or buy the freehold?

Yes, but this is covered by different legislation, and it may be advisable to buy the freehold rather than extend the lease (this process is known as leasehold enfranchisement). 

Q. Can I buy the freehold of my flat?

In certain circumstances, tenants can group together to purchase the freehold of their building. This is a complex process, requiring the consent of the majority of the affected leaseholders, and there are detailed qualifying criteria. 

Q. Do I need to pay Stamp Duty?

You will only have to pay stamp duty if the premium for the extension is over the minimum threshold (for current rates and bands, see HMRC).

Q. What will a lease extension cost?

To obtain an extension to your lease you have to pay a premium to your freeholder. This figure is determined by a surveyor, who calculates a proposed figure, based on a number of factors including the remaining term of the lease and the value of the property. This figure has to be negotiated with your freeholder and in statutory cases, where negotiations fail, it is determined by the Leasehold Valuation Tribunal. In addition to the premium, you will have to pay the professional fees of your solicitor and surveyor and also your freeholder's valuation and legal costs as well. Our comparison service ensures that your professional fees are very competitive, whilst giving you the reassurance that the professionals you instruct are of a high quality. You will know the cost up front, giving you peace of mind.

Q. What is meant by the term "leasehold enfranchisement"?

This is the process of freeing yourself from the slavery of a lease. The term applies only to residential property and there are various statutory provisions distinguishing the different rules for houses, individual flats and blocks of flats.

Q. How does your function differ from that of a lawyer?

These claims involve both legal and valuation issues. The lawyer can advise you on your legal rights and deal with the necessary conveyance. The surveyor is the one who acts as a valuer in advising you as to the correct price. He then acts as a negotiator in seeking to agree the best price with the opposing party. In those rare occasions where the matter is referred to the Leasehold Valuation Tribunal, the surveyor must then act as an expert witness in presenting evidence at the hearing.

First, as a valuer we prepare a valuation to estimate how much it is likely to cost. In the case of claims under the Leasehold Reform, Housing and Urban Development Act 1993, it is necessary to propose a price in the notice and, following case law, that price must be reasonable. It is therefore essential to have such advice prior to serving a notice under the 1993 Act.

With claims under the Leasehold Reform Act 1967, there is no requirement to propose a price. However, it is still advisable, as any statutory notice makes the claimant liable for the landlord’s legal and valuation costs, whether the transaction is completed or not. Therefore obtaining a professional opinion at the outset may avoid the possibility of the price subsequently proving unacceptable, resulting in the need to withdraw from the claim and incurring abortive costs.

If the client decides to proceed with a statutory claim, the procedure to establish a legal right is best dealt with by a solicitor with whom we will consult to ensure that a suitable price is proposed in the notice, where this is necessary.

Once the landlord has admitted the claim, our function is that of negotiator and our aim is to reach a settlement at the best possible price. There may be issues relating to the form of the new lease which fall within our responsibility, but generally issues relating to the form of the new lease, or the terms of the freehold transfer, are best dealt with by a solicitor.

By far the majority of claims are resolved by negotiated settlement, but where this is not possible, the matter may be referred to the Leasehold Valuation Tribunal. In this event, our role is that of an expert witness. We will prepare the necessary proof of evidence, and consult with counsel, if counsel is to be appointed. We will then present a submission to the tribunal by way of an examination in chief and deal with cross-examination by the opposing counsel.

Q. How much experience have you had?
We have specialised in representing tenants since 1981, since when we have dealt with claims on all of the central London estates and have advised more than 800 clients.

Q. How long does it take to enfranchise a lease?
It can be anything between about two months and thirty months. Most range from start to finish at about six months. A typical series of events would be as follows:

1. A statutory notice is served requiring a response within 2 months.

2. 2 months later the notice is admitted (but it could be that much sooner).

3. As soon as the notice is admitted, the landlord may file an application with the Leasehold Valuation Tribunal and at the same time it will then be possible to enter into negotiations with the landlords' surveyor. Those negotiations may endure for several months.

4. After about six to eight months, if one of the parties has lodged an application with the valuation tribunal, a date for the hearing may be notified in two months time.

5. Once the price is agreed or determined by the tribunal, the statutory regulations allow that the landlord cannot serve a completion notice for one month and that completion notice must allow one month - so that's two months in aggregate - and if completion has not taken place by the end of those two months, the landlord can serve a second notice requiring interest to be paid. If it has not completed by the expiry of those two further months - so that's now four in aggregate - the claim is deemed to be withdrawn, the landlord can claim their abortive costs from the tenant and the tenant is debarred from making another claim for three years.

If either party lodges an appeal to the Lands Tribunal, it would delay matters by about a year.


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M4U Chartered Surveyors



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