Leaseholds, are diminishing assets .This means that with every year that passes the value of the lease decreases. Consequently the law has granted the leaseholder the right to extend their lease once they have owned it for two or more years.
The Statutory right is the right to add 90 years to what is left on an existing residential lease at a “peppercorn rent.” This means that no ground rent is payable. For example if a leaseholder has 90 years left on the lease, they could extend the lease to 180 years (90 + 90 = 180). The landlord is entitled to a premium (the price) for the lease extension and this is based on a formula set out in the Leasehold Reform Housing & Urban Development Act 1993 (as amended by subsequent Acts). This is the leaseholders statutory right to extend their lease.
The alternative to the Statutory route is the informal negotiation route which does not have any restrictions in the negotiations of extending the lease with the landlord (freeholder).
Whether the formal statutory route is used or the more informal route, or if you just don’t know which to choose, Strictly Law can advise and perform the practical steps required to extend your lease, seamlessly and pain free.
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