Quiz - how well do you understand your lease?
Understand the key things you should know about your lease. If you are a purchaser, this can help make sure your solicitor has covered all of these points and explained them clearly to you.
Once you have been the registered owner of the flat for 2 years you will generally qualify to extend your lease under the Leasehold Reform, Housing and Urban Development Act 1993 (the 1993 Act).
It is possible for the seller, if they have owned the lease for at least 2 years, to serve a Section 42 notice to start the lease extension process and assign the benefit of the notice to the purchaser. This means that you will not have to wait 2 years to extend the lease. There is no prescribed form for the assignment but it needs to be clear that the purpose of the notice is to assign the benefit of the Section 42. This has to be done before, or at the same time, as the lease is legally assigned.
Alternatively it may be possible to extend the lease informally by agreement with the landlord either before or after the sale. If you are informally negotiating there are no rules and so you cannot insist on the landlord agreeing to grant an extension or transferring the benefit of an agreement to the buyer.
You should take specialist valuation advice on the likely cost of the lease extension as the cost may increase if you have to wait 2 years. This is especially true if the lease is currently just above 80 years, as marriage value makes lease extension much more expensive under 80 years.
If you proceed with the purchase, it is possible for the seller, provided they qualify, to start the lease extension process under the 1993 Act by serving the section 42 notice and assign the benefit of the notice to you. This will mean you can continue with the process without having to wait 2 years.
Lease extension can be a difficult process. We recommend you get professional help from a solicitor and surveyor with experience in this area.
More information you might find useful:
- Lease Extension – Getting Started
- Freehold vs leasehold conveyancing flowchart
- More Frequently Asked Questions on Purchase/Sale
Still not found the answer?
Contact LEASE to have your enquiry dealt with by one of our experienced advisers