About your lease

Can I extend my lease?

If you have owned your property for at least two years it is likely you will have the right to extend your lease. If you meet the criteria, you will be able to buy a new lease which will expire 90 years after your current lease expires.

Can I extend my lease if I am shared ownership leaseholder?

Shared Ownership leaseholders can now extend their leases when they own less than 100% by a discretionary lease extension.

Discretionary Lease extensions will be provided on the following terms:

• The same time limits will be in place as a statutory lease extension
• The new lease will be issued on the same terms as the original lease
• The Application Notice and Landlord’s Counter Notice will require the same information as a statutory lease extension
• Leaseholders must comply with the same necessary conditions as a statutory lease extension, for example; no current breach of lease, no arrears, agree to pay all reasonable costs of the Freeholder.

3 steps to extending your lease

1. To begin the lease extension process you must serve us with a Section 42 notice which is a confirmation of the premium amount you are willing to pay. 
2. On receipt, we instruct our valuer to calculate the premium. Leasehold Operations are unable to advise on the valuation of your property.
3. After receiving the valuation, we provide our Section 45 counter- notice, which either accepts or counters the terms of your notice.

Please note that you are required to complete your lease extension within six months from the date of our Section 45 notice. Should this matter not complete within six months, it will be withdrawn and you will be unable to re-apply until 12 months have elapsed from the date of withdrawal. 

How much am I likely to pay?

Please note that Leasehold Operations are unable to advise on the price of your lease extension. We recommend you visit Leasehold Advisory Service for independent advice.

Our fees include:

• £200 administrative fee
• £350 valuation fee
• £102 lease plan fee
• the solicitor’s actual costs, which are set at £1,365 but may increase if the matter becomes protracted

Extend your lease video

 

The Leasehold Reform Act

The Leasehold Reform Act received Royal Assent and became law on the 24 May 2024 when the bill was passed. Three key elements were cut from the Act, capping ground rent, abolition of leasehold and prevention of forfeiture.

The bill has been passed, but is not yet in effect, and at this time, there are no dates when it will be. The legislation simply states, "The other provisions of this Act come into force on such day or days as the Secretary of State may by regulations appoint".

In order for the Act to be implemented there needs to be additional pieces of legislation.

The current government suggest the reforms will come into effect in 2025/2026.

A summary of the Act can be found below:

The Act – which has officially received Royal Assent – strengthens existing, and introduces new, consumer rights for homeowners by:

• Making it cheaper and easier for people to extend their lease or buy their freehold so leaseholders pay less to have more security in their home.
• Increasing the standard lease extension term to 990 years for houses and flats (up from 50 years in houses and 90 years in flats), so leaseholders can enjoy secure ownership without the hassle and expense of future lease extensions.
• Giving leaseholders greater transparency over their service charges by making freeholders or managing agents issue bills in a standardised format that can be more easily scrutinised and challenged.
• Making it easier and cheaper for leaseholders to take over management of their building, allowing them to appoint the managing agent of their choice.
• Making it cheaper for leaseholders to exercise their enfranchisement rights as they will no longer have to pay their freeholder’s costs when making a claim.
• Extending access to redress schemes for leaseholders to challenge poor practice. The government will require freeholders, who manage their building directly, to belong to a redress scheme so leaseholders can challenge them if needed – managing agents are already required to belong to a scheme.
• Making buying or selling a leasehold property quicker and easier by setting a maximum time and fee that for home buying and selling information.
• Granting homeowners on private and mixed tenure estates comprehensive rights of redress, so they receive more information about what charges they pay, and the ability to challenge how reasonable they are.

The Act will further benefit leaseholders by:

• Scrapping the presumption that leaseholders pay their freeholders’ legal costs when challenging poor practice that currently acts as a deterrent when leaseholders want to challenge their service charges.
• Banning opaque and excessive buildings insurance commissions for freeholders and managing agents, replacing these with transparent and fair handling fees.
• Banning the sale of new leasehold houses so that, other than in exceptional circumstances, every new house in England and Wales will be freehold from the outset.
• Removing the requirement for a new leaseholder to have owned their house or flat for 2 years before they can extend their lease or buy their freehold.

Further information can be found on the links below:

Leasehold reforms become law - GOV.UK (www.gov.uk)

Leasehold and Freehold Reform Bill (parliament.uk)

Leasehold and Freehold Reform Bill - Parliamentary Bills - UK Parliament

Should you extend your lease or should you wait for the changes to be implemented?

The new act is not in effect and the current guidance from Government suggests it will be in place in 2025 to 2026. You may wish to seek independent legal advice on a lease extension if:

1. Your lease is 80 to 82 years term remaining – It is unlikely the reforms will be in place before your lease drops below the 80 year mark (at which point the marriage value makes it more expensive under the current legislation to extend).
2. You want to move or re-mortgage.
3. Lease is above 82 years term remaining.
4. Your lease is already below 80 years term remaining.

The Leasehold Advisory Service provide advice on what leaseholders should do in this situation. We would recommend reading through this advice using the link below.

https://www.lease-advice.org/faq/should-i-wait-to-extend-my-lease-i-have-heard-that-planned-changes-to-the-law-could-make-lease-extension-cheaper/

if you are still unsure, you can book an appointment with The Leasehold Advisory Service to speak to one of their advisors regarding this. Alternatively, you can also contact Leasehold Operations through one of the methods listed in the link below to discuss this further or get more information regarding your lease.

https://www.westminster.gov.uk/housing/leaseholders/contact-us

 

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