SERVICES
Leasehold Extension Valuation
What is a Leasehold Extension Valuation?
Obtaining a market value of the property helps us produce a lease extension valuation. But we also need to include figures and yields obtained through years of experience and previous tribunal decisions (both First Tier and Upper Tribunals). Essentially, our reports determine the figure that the leaseholder should pay to the freeholder to extend their lease. They also detail the best- and worst-case scenarios for both parties. The Leasehold Reform Housing and Urban Development Act 1993 is the primary legislation on Leasehold Extension.
Leasehold Extension or Enfranchisement as it is sometimes called, is a complex area and we would advise you seek professional advice before proceeding. At Dunham Hale Surveyors, we can assist with any questions you have before moving forwards.
What is a Leasehold Extension and do I need to extend it?
If you have a property or looking to buy a property which has a leasehold term of less than 80 years remaining, then our advice is that you consider extending the lease sooner rather than later. It is a fact that there are no financial benefits in extending a lease that still has over 100 years remaining. However, if you wait until your lease has less than 80 years remaining, extending it could be expensive. It could also affect its value if you decide to sell the property on in the future. If the property is close to the 85-year remaining mark, Dunham Hale Surveyors recommends you consider extending it as soon as you can.
In summary, the freeholder will stand to profit the most by waiting to extend a lease with less than 80 years remaining. But they’re legally obliged under the Act to grant any leaseholder a 90-year extension at any time during their occupancy, provided the leaseholder has lived in the home for more than two years and the lease was originally granted for a term of longer than 21 years. In the case of 21 years, most property will originally have had a lease term of longer and therefore nearly all property will qualify.
If you’re a leaseholder who wants to find out when it makes the most financial sense to extend their lease, we at Dunham Hale Surveyors can help. Similarly, if you’re a freeholder and want to ensure you are adequately compensated for granting the lease extension, we are at your disposal to help advise what you need to do.
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