Residential Property Lease Extensions

The law gives tenants who have purchased a leasehold property a legal right, subject to meeting certain conditions, to extend the lease on their property.

You can extend a lease either by entering into a mutual agreement with the freeholder, or exercising your legal right. If you exercise your legal right to a lease extension, it will add 90 years to the length of the lease (and reduce the annual ground rent to nothing – or in legal parlance, a “peppercorn”.)

Before you enter into a lease extension, you need to decide whether it is worth the effort and expense. As a general rule of thumb, if the lease is less than 90 years you should almost certainly try to extend it. This is because:

• Properties with shorter leases are less valuable than ones with long leases (this is particularly true if leases are below 80 years)
• Properties with shorter leases can be more difficult to get a mortgage on, because mortgage companies will worry that its value might decline and so won’t be good security
• Properties with shorter leases can be more difficult to sell

We can also assist you with:

• Transfer of Equity / Deed of Gift – this involves the transfer of one owner’s share of the equity to the remaining owner. A deed of gift is where no payment is made.
• Deeds of Covenant – whereby a new buyer or tenant agrees to comply with the rules and conditions affecting the property binding them in the same way as the previous owner/tenant
• Statutory Declarations for Title Rectifications – a formal declaration by an individual explaining any problems with the property’s title and often claiming the existence of rights acquired by the passage of time
• Transfer of Registered Estates / First Registration – dealing with the legal formalities, a process involving the Land Registry
• Freehold enfranchisement – rights of leaseholders as a group to purchase the freehold of a building, often happening together with lease extensions
• Property acquired at auction – offering exciting and potentially profitable opportunities, but requiring research and not without risk
• Remortgages – a remortgage can be for many reasons, including: better terms; requirement to release capital; on separation.
• Buy to let – dealing with the mortgage requirements, purchase of property and tenancies
• Declarations of Trust – for those entering into a purchase jointly and wanting to record their respective shares
• Assents – following a death transferring the property to beneficiaries