If you’ve owned a property for at least two years, you have the right to request a 90-year extension on your existing lease from your freeholder. For those considering purchasing a flat with a short lease (less than 85 years remaining), it’s important to be aware of the significant impact this can have on the property’s value. It’s advisable to seek a lease extension when the lease falls below 85 years. If the current owner has held the property for two years, they can initiate the lease extension process on your behalf, allowing you to avoid the two-year waiting period.

Andromeda Chartered Surveyors can assist you in obtaining a lease extension, starting with a valuation to determine a fair premium for the statutory lease extension. The extension will add 90 years to the current lease and eliminate any ground rent. They can also combine this service with a Level 2 or Level 3 Survey, potentially offering a discount.

Under the 1993 Leasehold Reform Housing and Urban Development Act, lessees have a right to extend their lease if they’ve owned the flat for two years. The lease extension eliminates ground rent and adds 90 years to the lease. The valuation considers the freeholder’s interest loss, the ‘marriage value’ of merging leasehold interests, and rare cases of compensation for the freeholder’s other property losses.

The legal process involves your solicitor serving an initial notice, followed by negotiation or, if necessary, tribunal involvement to determine the premium.

Extended leases increase property value and marketability, particularly for flats with very short leases, which are otherwise challenging to sell without offering significant discounts. Once extended, the property can be sold at full market value, appealing to a broader range of buyers, including those needing mortgages.