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.

Factors Affecting Lease Extension Valuation in UK

September 2, 2020

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If you own a leasehold property in UK and now it is the time to extend that lease, then you should be aware of the factors to be considered while estimating the cost of the lease extension. If you don’t have enough information and need guidance regarding the lease extension process or related aspects, you can reach out to our chartered surveyors. In this blog, we will take you through each factor that plays a vital role in lease extension valuation in UK –
Length of the Lease: Duration of the lease not only affects the property’s value, but it also affects the cost to be incurred in extending the lease. If the lease is not extended before its length falls below 80 years, the leaseholder needs to pay a higher amount for the lease extension. In addition, lenders tend not to want to lend mortgages on such properties.
Current Market Value of your Property: This can either be the current market value of your property with the current short lease or the value with a longer lease (ie after the extension has been completed).
Location of property: wherein the UK your property is located does have a bearing on the calculation. This is because property values in different parts of the UK grow at different rates and this is reflected in the Deferment rate applied in your calculation.
Ground Rent Payable: the ground rent you pay throughout the term of the lease is important as the landlord must be compensated for losing this income stream once you have extended your lease (as your ground rent will decrease to Zero)
At Leasehold Valuations, we deliver the services that you can rely on. So, contact our chartered surveyors today to see how much it will cost to extend your lease.

Factors Affecting Lease Extension Valuation in UK

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