This Act sets out the guidelines and requirements for a tenant (the current owner of the leasehold interest in the property) to extend their lease by paying the landlord (the owner of the freehold interest in the property) a sum of money, also known as the premium.
Under this Act any tenant that extends their lease will not only add a further 90 years to the term, but they will also have their ground rent converted to a peppercorn (zero).
The length of the lease will have a direct effect on its valuation, the longer the lease the higher the final valuation figure will be. As such, determining the exact lease length is key to establishing the total cost of the leasehold extension. Over the years our Surveyors have valued properties with leases ranging from 90 years to those less than 20 years.
The ground rent is the rent that the tenant pays the landlord each year. With ground rents usually changing a set intervals, or being tied to the Retail Price Index of the property (RPI), having a full understanding of how these can affect the value is key to accurate valuation.
This is the all important number when it comes to leasehold extension valuations. If the lease length is less than 80 years, the tenant instantaneously pays a higher premium to the landlord. The figure is also dictated by the long lease value of the property, therefore having a thorough understanding of this is key to valuing the property.
All of our Leasehold Extension Valuations are set at fixed a cost and include the inspection, report, discussion and recommendations once the report is complete and in the hands of our clients.
Our Leasehold Extension Valuation costs start at £575 + VAT.