A concerning statistic from NAEA Propertymark.
This article on City A.M. highlights the some of the many pitfalls that can, unfortunately, be associated with leasehold properties. It is vitally important to seek expert professional advice when purchasing a leasehold property, or when extending a lease.
If you already own a leasehold property you may be aware that your lease is essentially a diminishing asset, and there will come a time when you need to extend your lease. You may either decide to extend your lease proactively to preserve the full value of your home, or reactively because you are selling your property and a long lease is required to secure the sale. In either scenario, but more commonly the latter, a leaseholder may consider it best to take the “fast lane” and approach their landlord on an informal basis for a lease extension. The landlord will usually oblige, perhaps offering to extend the lease back up to 99 or 125 years. Crucially however, the landlord will often seek to retain or increase the ground rent payments. Onerous ground rent provisions in leases, such as high or doubling ground rents, can render a property unsaleable.
A well advised leaseholder will be informed of their rights under the Leasehold Reform, Housing and Urban Development Act 1993 (LRHUDA 1993). Provided you have owned your property for at least two years, and your lease was granted for a term of more than 21 years, you will have a statutory right to extend your lease. This means that you can compel your landlord to grant a new lease of your property for a term of 90 years on top of the remaining unexpired term, at zero ground rent.
Our specialist leasehold enfranchisement team dealt with over 250 cases in 2018 relating to collective enfranchisement, lease extensions, right to manage, and rights of first refusal. We are a member of ALEP (Association of Leasehold Enfranchisement Practitioners) a badge of assurance to leaseholders and freeholders that they can be sure of a consistently high level of service, integrity and professionalism. Contact our team on 01903 213511 for advice relating to lease extensions, leasehold disputes and leasehold sales/purchases.