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Flat owners: check how many years your lease has left

A leading Midlands property litigation lawyer urges flat owners to consider extending their lease term to protect their financial interests.

People who own the leasehold interest of a flat do so for a defined number of years, meaning its value reduces as the lease term gets shorter.

However, Stephanie Rushfirth, an associate at law firm mfg Solicitors, has warned that all residential leaseholders of flats have the right to extend their leases by a further 90 years, subject to specific qualifying criteria being met – urging them to do so sooner rather than later.

She said: “It is best not to wait too long to extend a lease as waiting will only make the process more expensive and may impact your ability to sell on a leasehold interest in the future.

“If flat owners wait until less than 80 years are remaining on a lease, they will pay significantly more to the freeholder by way of a premium in return for the freeholder’s agreement to extend their lease by a further 90 years.”

The lease extension process will be reviewed and reformed in future government legislation to make it less time-consuming and expensive.

However, there is no indication of when this might happen, whether there will be any challenges to the reforms or whether any of the proposed provisions will be watered down.

Ms Rushfirth has therefore advised flat owners to check how many years are left on their leases and seek the expert advice of specialist solicitors to ensure the process can get underway in good time to avoid paying a more expensive premium for an extension.

She added: “Although the lease extension is normally resolved without the need for issuing proceedings either at the County Court or at the First Tier Tribunal, this may be necessary if the freeholder fails to serve a counter-notice or if the parties cannot agree on the premium to be paid to the freeholder.

”There are however strict deadlines in this process, and they mustn’t be missed, which is why it is so important to instruct a specialist solicitor to help.”

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