Lease Extension Solicitors

Flats are usually owned under a long lease. As the term of the lease decreases the flat becomes less valuable. Once the term of the lease is less than 60 years it will become increasingly difficult to mortgage and therefore more difficult to sell and probably less valuable. However, subject to a few exceptions, owners of flats have a right to extend the lease on their flats under the Leasehold Reform Housing and Urban Development Act 1993 (hereon “the Act”). This blog takes a brief look at lease extensions and answers some frequently asked questions.

Am I a qualifying Tenant for a lease extension?

Generally, you will be a qualifying Tenant if your lease was for more than 21 years when it was originally granted and you have been the registered Lessee of your flat for more than 2 years and provided that your Lease is not excluded. Leases are excluded if the freeholder is the Crown, National Trust or part of a building within a cathedral precinct. Shared ownership leases do not qualify unless your shareholding has been increased to 100%.

What is the procedure for obtaining a lease extension?

There are two ways of obtaining a lease extension – either by agreement with the Landlord outside the Act or by using the procedure set out in the Act. The procedure under the Act is started by serving a notice on the Landlord (a “section 42 Notice”). We will not outline the entire procedure here but suffice to say that if an agreement is not reached the Tenant will need to make an application to the First Tier Tribunal (Property Chamber).

How much will it cost to extend my lease?

You will have to pay a premium to the Landlord. You will also have to pay your Landlord’s costs including his legal costs and surveyor’s costs. You will also have to pay for your own legal costs and surveyor’s costs.

Will I need to instruct a solicitor?

There is no legal requirement to instruct a solicitor howeverThis  the lease extension process can be difficult and complicated and for most people it will be beneficial to instruct a solicitor. Since Landlords/Freeholders are entitled to recover their legal costs from the Tenant/Leaseholder there is little advantage to be gained by not appointing a solicitor.

Hastings & Co Solicitors can assist both landlords and tenants in connection with lease extensions.

t: 01621 876 031.


Two Common Mistakes by Landlords

Liam Hastings of Hastings & Co Solicitors based in Chelmsford, Essex looks at 2 common mistakes made by landlords.

Mistake No 1 – defective Section 21 notices. A novice landlord quickly learns that he or she can regain possession of his or property by serving a “Section 21” notice on the tenant and they also learn that a Section 21 notice must give the tenant a minimum two months’ notice. However, it is often missed that the notice must expire “on the last day of a rent period” ie on a specific day of the month. Therefore, the landlord must give a minimum two months’ notice which ends on the last day of a rent period. If the wrong date is put on the notice it will make the notice defective.

The notice must also be in a prescribed form giving the tenant certain information. A letter from the landlord will almost certainly not comply.

Mistake No 2 – failing to protect the tenant’s deposit. Since April 2008 landlords have been required to protect tenant’s deposits in one of the recognised tenancy deposit schemes. They must also serve a notice on the tenant giving the tenant certain information about the deposit. There are 2 potential consequences for failing to protect the deposit. Firstly, the tenant can claim compensation from the landlord up to three times the value of the deposit. Secondly, the landlord is not able to serve a Section 21 notice on the tenant.

Hastings & Co Solicitors specialise in Landlord & Tenant law. Please telephone Liam Hastings on 01245 835 305 for further advice or assistance.

Disclaimer: this blog is intended to give a brief overview of the law and does not substitute for independent legal advice.