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.

How to Calculate Remaining Lease Term?

September 26, 2023

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Calculating the remaining lease term of a property involves a straightforward mathematical calculation. Here’s how you can calculate it:

Step 1: Find the Lease Start Date

First, you need to know the start date of the lease. This information is usually provided in your lease agreement or by your property management company.

Step 2: Determine the Lease Duration

Check your lease agreement to find out the total duration of the lease. Leases can vary widely in length, typically ranging from 99 years for residential leases to longer terms for commercial properties.

Step 3: Calculate the Remaining Lease Term

Once you have the lease start date and the lease duration, you can calculate the remaining lease term using this formula:

Remaining Lease Term = Lease Duration – (Current Year – Lease Start Year)

Here’s a breakdown of the formula:
- “Lease Duration” is the total number of years the lease was initially granted.
- “Current Year” is the current calendar year.
- “Lease Start Year” is the year in which the lease started.

Example of Remaining Lease Calculation:

Let’s say you have a residential lease that started on January 1, 2000, and it’s a 99-year lease.

Current Year: 2023

Lease Start Year: 2000

Lease Duration: 99 years

Using the formula:

Remaining Lease Term = 99 – (2023 – 2000) = 99 – 23 = 76 years

So, in this example, the remaining lease term would be 76 years.

Keep in mind that this calculation assumes that there are no lease extensions, reductions, or other factors that may affect the remaining lease term. If there have been any lease extensions or variations, you should consult your lease agreement or a legal expert like a Leasehold valuation surveyor for a more accurate calculation.