The leasehold system of ownership of residential property in this country means that leaseholders own their property for a certain number of years. Most commonly, flats are originally sold on leases of 99 or 125 years (however this does vary). Over the years, your lease term reduces. Once the term reduces to circa 80 years or under, the saleability of your flat is affected as lenders require a certain number of years on your lease.
The Leasehold Reform, Housing & Urban Development Act 1993 (as amended) (LRHUDA 1993), gives long leaseholders of flats the opportunity to extend the lease term by an additional 90 years and as a result pay no further ground rent. This is subject to meeting certain criteria. The process is initiated by the service of a Section 42 Notice under the LRHUDA 1993 by your instructed solicitor. The process in the Initial Notice will include the deadline by which the Landlord must serve a Counter Notice. The Landlord will then serve a Counter Notice by the date specified in the Initial Notice. If the two parties cannot agree the premium, then there is a statutory period for negotiation, and we will attempt to negotiate the settlement of the premium with the other side’s surveyor to reach a suitable conclusion. If the two parties still cannot agree the premium, then an application is made to the First Tier Tribunal (Property Chamber) for determination of unresolved issues concerning the valuation. If you own the lease of your flat, you should consider extending the lease term while the unexpired term still exceeds 80 years. If it falls below this term, the cost of the lease extension becomes more expensive.
The process for both landlord and leaseholder can be time consuming and complex. We are able to provide you with sensible, realistic and cost effective advice to arrive at the right price or premium. We will work closely with your solicitors to ensure that the correct steps are taken to bring about a successful outcome.
We act for both Lessees and Lessors and provide the following services:
• Valuation advice for the cost of the lease extension;
• Undertaking negotiations on behalf of the leaseholders or Landlords; and,
• Preparing and providing expert evidence at the First Tier Tribunal (Property Chamber).