What is a leasehold extension?

A leasehold extension is the process of extending the lease term of a property held on a leasehold basis. It helps maintain the property's value and desirability. Leasehold extension legislation allows leaseholders to extend their lease, ensuring the property remains attractive for sale or mortgage purposes.

How long is a leasehold extension ?

The length of a leasehold extension can vary depending on the jurisdiction and specific circumstances. In some countries, such as the United Kingdom, leasehold extensions are typically granted for an additional 90 years beyond the remaining term of the existing lease. However, it's important to note that leasehold extension regulations can differ, and it's advisable to consult local laws or seek professional advice like leasehold valuations for accurate information regarding leasehold extensions in a specific jurisdiction.

What are the benefits of lease extension ?

Extending the leasehold of a property offers benefits such as increased property value, improved marketability, easier access to mortgage financing, peace of mind and security, the avoidance of escalating costs, and more control over property management.

What happens to leasehold property after 99 years ?

After 99 years, the leasehold property typically reverts back to the freeholder, unless the lease is extended by the leaseholder. The ownership of the property, along with the land it is built on, returns to the freeholder once the lease expires. As a lease approaches its expiration, the property’s value may decrease, making it more challenging to sell or mortgage. It is advisable for leaseholders to consider extending their lease well before it reaches the 99-year mark to maintain the property’s value and their ownership rights.

Why choose leasehold Valuations for Lease extension or Buying Freehold ?

1. Fair Price: A leasehold valuation ensures you pay a fair price for a lease extension or freehold purchase.2. Increased Property Value: Extending the lease or buying the freehold can potentially increase your property’s value.3. Cost Savings: Accurate valuation helps minimise future costs like ground rent.4. Stronger Negotiation: A valuation report strengthens your position during negotiations with landlords.5. Legal Compliance: Valuations ensure you meet legal requirements for lease extensions or freehold purchases.6. Future Planning: Valuations help you plan for selling or passing on the property to future generations.7. Expert Advice: Engaging a valuer provides access to their expertise and guidance.8. Mortgage Support: Valuation reports improve your mortgage opportunities for lease extensions or freehold purchases.

How much does it cost to renew a leasehold ?

The cost of renewing a leasehold in the UK can vary depending on various factors, such as the property value, the length of the renewal term, and any negotiations between the leaseholder and the freeholder. Unlike extending a lease, which typically involves paying a premium to the freeholder, renewing a lease generally involves paying a nominal fee known as a “peppercorn rent” or a small percentage of the property value.The exact cost of renewing a leasehold will depend on the specific terms agreed upon between the parties involved. It is advisable to consult with a solicitor or a licenced conveyancer who specialises in leasehold matters to get an accurate estimate of the costs involved based on your particular situation.

Q. How much does it cost to extend a leasehold in uk ?

The cost of extending a leasehold in the UK can range from a few thousand pounds to tens of thousands of pounds, depending on factors such as the remaining lease length, property value, and negotiated terms with the freeholder. Additional costs include legal fees, valuation fees, and disbursements such as Land Registry fees. It’s recommended to seek professional advice for an accurate estimate based on your specific situation.

A Professional Insight into Flying Freeholds and Deed of Mutual Covenant

February 14, 2024

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Introduction

Hello and welcome to our real estate blog, where we break down the complexities of property matters in simple terms. Today, let’s dive into the world of flying freeholds – a topic that might sound puzzling but is more common than you think. As a chartered surveyor with a knack for explaining legal jargon in everyday language, I’m here to guide you through the basics and offer practical tips on how to deal with flying freeholds.

Understanding What is Flying Freeholds

So, what’s a flying freehold? Imagine part of your property, like a room or a balcony, hanging over or under another property that doesn’t belong to you. That’s a flying freehold.

How to Check if You Have a Flying Freehold

To figure out if you have a flying freehold, take a look at your property documents. If any part of your home hangs over a neighbour’s property, and you don’t own that bit of land, you might have a flying freehold.

Making Sense of the Deed of Mutual Covenant

Now, let’s talk about the Deed of Mutual Covenant (DMC). Think of this as a kind of agreement between you and your neighbour. It’s like a deal that says, “Hey, we both own bits of this property, so let’s agree on how we’ll take care of things.” This includes deciding who is responsible for repairs and how you can both use the shared space.

Tips for Dealing with Flying Freeholds

Talk to Your Neighbours

Start with a friendly chat. Discuss any concerns you might have and try to work together on things like maintenance and access. It’s a bit like agreeing on how to share a communal garden.

Get Some Help from a Legal Pro

If things get a bit tricky, it’s time to call in the experts. A Real Estate Chartered Surveyor is like your guide through the legal maze. They can help you understand the rules and make sure everything is fair and square.

Check Your Papers Regularly

Keep an eye on your property documents. It’s a bit like giving your home a health check. Regular reviews and surveys can help you spot any potential issues early on.

Free Initial Leasehold Advice

Get expert insights on leasehold matters. Book an initial free consultation with our RICS Chartered Surveyors & Valuers for guidance on

Lease extension,
Purchasing leasehold, freehold, or share of freehold,
Selling a leasehold property with a short lease,
Simultaneous lease extension and sale.

Benefit from our specialised team, including RICS valuers for premium negotiation and surveyors for section 42 notice and formal or informal lease extensions.

Request a personalised quote for

RICS Lease Extension Valuation,
Section 42/13 notice serving,
Negotiation support,
Legal work completion,
and Tribunal application for determining the premium,
Secure your property journey with us.

Also read, Leasehold v/s Freehold , How to calculate remaining lease term? , How to extend the lease of a flat?

Conclusion

In a nutshell, dealing with flying freeholds is all about communication, a bit of legal help, and keeping an eye on your property papers. If you ever feel lost in the real estate skies, don’t hesitate to reach out for guidance. Stay tuned for more simple explanations of real estate matters, and remember – understanding your property doesn’t have to be rocket science!