The main reason for extending your lease is that once the
remaining term of a lease drops below 80 years, the cost of an
extension rises by what is called the ‘marriage’ value.
This means that the value of your lease is likely to start to decrease and the cost of extending it will increase significantly; thus we would always advise extending before the 80
year threshold is reached.
It is also important to consider that leases that are of a shorter duration, particularly with less than 60 years to run, can inhibit sales and remortgages as banks are often reluctant to
lend against the shorter term leases.
The 1993 Leasehold Reform Act
(as amended) provides for the right to be granted a new lease for a term of 90 years,
plus the present unexpired term.The
formal procedure is started by the service of the Tenant's Notice on
the landlord (the Tenant's Notice) it then follows a prescribed route.
This is the beginning of the formal process for acquiring the ninety
year extension.
It is important to consider that lease extensions do not need to follow the formal prescribed route and can be agreed on informally between landlord and tenant directly, although the tenant should expect to pick up the landlord's 'reasonable costs' associated with the process.
There is a substantial amount of work involved in a lease extension and
Abingdon Estates can guide you through the service with minimum hassle
and cost.
If you would like an idea of how much your lease extension may cost or for more information please contact us.
