Do obtain specialist valuation advice as to the likely premium the landlord should charge for a lease extension. Forewarned is forearmed and it is most sensible to have an idea as to what is a market value for a lease extension before you enter into negotiations with the Landlord.
Do find out the legal costs before you embark on the process of a lease extension . Speak to your property lawyer who will probably advise you that you will not only be responsible for their fees but also the Landlord’s conveyancing/property lawyer 's fees and lender’s fees (if you have a lender). It is generally advisable to go into the lease extension process with your eyes wide open knowing at least a ballpark figure as to your total costs.
Do explore the possibility of buying the freehold with the other tenants in the building. It may be more economically viable to acquire the freehold with the other tenants. You will still need a property lawyer to deal with this but it may prove to be less expensive than extending the leases individually.
Do advise the agent marketing your property if you are in the process of extending the Lease . Ensure that you disclose the details in the Property Information Questionnaire (PIQ). The PIQ is a questionnaire being a compulsory part of a Home Information Pack. This Questionnaire will ask how many years remain under the Lease. You should accurately disclose this figure but also add in manuscript whether or not you are in the process of extending the Lease.
Do not instruct your conveyancing lawyer to commence the initial negotiations with your Landlord or managing agents. Rather, in the first instance, try and negotiate with the Landlord and personalise the relationship. By instructing a conveyancing lawyer at the outset the Landlord is more likely to treat the matter formally and may be inclined to increase the cost once he or she realises that you are already spending money. If you manage to create a personal relationship and open dialogue with the Landlord you might have more success in negotiating the lease extension premium down .
Do not give up. If your Landlord is coming up with an unreasonable premium for the lease extension you should then speak to a conveyancing solicitor or conveyancing lawyer. Once you have owned the property for more than two years you will have an automatic right to a lease extension for a further 90 years (subject to certain exceptions) although you will have to pay an appropriate market rate. Ultimately you can take the Landlord to a Leasehold Valuation Tribunal and have the figure determined by a Tribunal.
Do not reveal to the Landlord that you are planning to sell your property or are in the process of selling the property. If the Landlord knows that you are desperate for a lease extension this could result in you being held to ransom. It is preferable to advise the Landlord that your understanding is that lenders prefer to lend on long leases and therefore if you wish to re-finance the property in the future you want to know that you will not have a problem with a lender.
For more information on lease extensions please contact one of our leasehold conveyancing lawyers in the Lease Extension Team who will he happy to assist.