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Estate
Management
& Chartered Surveyors
For
More Information Call:
01279 870610'
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Obtaining a
Lease Extension -
Further Information
& Frequently Asked Questions
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What you need to know to start....
- You have to have owned your flat for 2 years.
- You need to obtain a valuation from SWA Chartered Surveyors
- You will need to identify an experienced Solicitor
please note that information provided on this
site is given as a guide only and is not intended as a legal
interpretation
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What are the likely costs?
- You have to pay a premium for the Lease Extension set
by the local Valuation Tribunal in accordance with the Act
- You have to pay Solicitors and Surveyors
costs
(of course if the premium set
is too high you can change your mind subject to paying any costs
incurred) |
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How long does the process take?
The timing for the process is set down by the Act. Initially
a formal notice is served to your Landlord to which he or
she must respond within a fixed period. There is then a period
for negotiation of terms. Finally there is a right to apply
to the Valuation Tribunal on any terms which have not been
agreed. The timing of the Tribunal hearing and their decision
depends on workload. The whole process can take a year or
more.
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What are the common problems or mistakes?
- The most common mistake is asking your Landlord for a
new Lease when you are trying to sell. The costs are
likely to be much higher.
- The notice served on your Landlord must be correct. To
avoid incurring unnecessary extra costs make sure your Solicitor
is experienced in this specialist field.
- As a general rule if your Landlord seems happy to extend
your Lease then he is probably overcharging in some way.The
amount of Ground Rent and the term of the Lease extension
is laid down by Parliament.
- The Ground Rent, the Lease term and whether the rent payable
goes up during the term are ALL important and influence
the value of your flat when you come to extend or when you
sell. The more the ground rent and the shorter the term
so the less the value of your flat when you come to sell,
because it will cost more for the Lease extension.
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What part does your Surveyor play?
- The Surveyor provides an initial valuation so that you
can decide what financing may be necessary. During the process
thereafter, SWA can provide advice on an appropriate figure
to be included in the Statutory Notice.
- Once negotiations commence, SWA acts on your behalf advising
on the implications of all aspects and allowing you to make
decisions at arms length. In many cases the matter is successfully
negotiated by the Surveyor before reaching the Tribunal
stage.
- The Surveyor advises the Tribunal of the points in dispute
and provides a formal valuation on behalf of the Tenant.
- At the Tribunal Hearing the Surveyor argues the Tenants
case providing evidence to substantiate the case. Another
expert Surveyor usually represents the Landlord and also
gives evidence. The Surveyors may question each others evidence,
they will also answer technical questions asked by the Tribunal
Members or provide additional evidence as requested.
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What Part does the Solicitor play?
- The Solicitor serves a formal notice on the Landlord amd
may request any information.
- The Solicitor gathers all necessary Legal information
to be submitted to the tribunal
- Once the Tribunal decision is made the Solicitor finalises
the Legal process and registers the new Extended Lease title.
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Can the Tenant be present at the Tribunal hearing?
Yes, Tribunals are open.
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Does the Solicitor need to be at the Tribunal Hearing?
Usually not, but the Solicitor may be called upon if a dispute
arises on a Legal issue or on Legal fees. SWA usually ask
that the Solicitor be contactable during the respective period.
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What alternatives are there?
- You can join together with other Leaseholders in your
block to purchase the freehold
- Once you have started the Lease extension procedure by
serving the appropriate notice you will be in a much stronger
position to negotiate with your Landlord
- If you have excessive charges for estate services you
receive you have the right together with other Leaseholders
to take over the management. This is a relatively low cost
procedure. See Right to Manage
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Are there any disadvantages of the Lease Extension process
compared to Enfranchisement?
(Enfranchisement is the purchase of
the freehold collectively by 50% or more of tenants in the
block)
The Lease extension process incurs costs to
a single Leaseholder, many of which are shared with other
Leaseholders in the Enfranchisement process.
Freehold purchase also gives collective control
over the estate management.
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Are there advantages of the Lease Extension process over
Enfranchisement?
Although most tenants may eventually take part in the Freehold
purchase process, in the first instance a small number of
people may be responsible for getting the ball rolling. The
process is much quicker to get going for a Lease extension
as there is only one party involved in decisions.
In Enfranchisement those tenants who participate also have
to purchase the Landlords interest in the part of the freehold
that is still Leased to those who don't. The purchase also
includes any additional value which might be attributable
to the Land.
More information on Leasehold Ownership and Enfranchisement
can be obtained by reference to LEASE
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Why SWA Chartered Surveyors?
When the matter reaches Tribunal stage your case is represented
by your surveyor so it is therefore important that your Surveyor
has experience and success at Tribunals
SWA specialise in this type of work and has successfully
represented Clients in negotiations with Landlords and at
Tribunal.
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What should you do next?
Click E-mail us on the left hand side panel of this page
or Email: lease@swa-surveyors.com with details of your flat
to obtain a quotation for a valuation.
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What is a 'peppercorn'?
A 'peppercorn' is the minimum value allowed by Common Law
for rent payable under a Lease. It is as near as possible
to zero
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SWA
Estate Management
& Chartered Surveyors
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All
site content copyright © 2000 SWA (UK) Ltd
Fax: (44) (0)1279 870670
Please send any comments to our WebMaster
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Surveyors
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The
Tack Room
Waltham Hall
Bambers Green
Bishops Stortford
CM22 6PF
Tel: 01279 870600
Tel: 01279 870610
Fax:01279 870670
E-mail:info@swa-surveyors.com

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