Lease extension counter notice for freeholders

• Day 1: You receive the Section 42 Notice from the leaseholder. 

• Within 21 days: You can request proof of the leaseholder’s legal ownership. 

• Within 2 months: You must serve a Counter Notice (Section 45 Notice), either accepting or disputing their terms. 

• After 6 months: If an agreement is not reached, either party can apply to the First-tier Tribunal (Property Chamber) for a ruling. 

• The leaseholder may automatically get the extension on their terms. 

• You may lose the right to challenge the proposed premium. 

• You may receive less compensation than the lease extension is truly worth. 

Time is critical. If you’ve received a Section 42 Notice, contact our leasehold solicitors immediately for expert guidance. 

Your Counter Notice will set out one of the following responses: 

• Accepting the leaseholder’s offer (rare unless their valuation is fair). 

• Proposing a higher premium (backed by professional valuation evidence). 

• Refusing the lease extension on limited legal grounds (e.g. redevelopment plans). 

If negotiations fail, the case may go to the First-tier Tribunal (Property Chamber), where an independent ruling will be made on the lease extension terms. 

For initial advice, a quotation or to arrange a meeting with one of our solicitors, please contact us on 020 7940 4060 and ask for a member of the Leasehold Service Team or send us your query at mail@anthonygold.co.uk. 

If your tenant has not served a Section 42 notice but has contacted you requesting a lease extension, this could present an opportunity for you and the leaseholder to agree on terms that are different from those they would be entitled to obtain through the statutory process

This can allow greater flexibility on: 

• Premium pricing (potentially securing a better deal for you). 

• Lease terms (such as retaining ground rent instead of reducing it to zero). 

• Legal and valuation fees (negotiating who pays these costs). 

Our expert solicitors regularly advise freeholders on both statutory and voluntary lease extensions, ensuring you maximise your financial return while remaining legally protected.

The leaseholder’s Initial Notice will include their proposed premium—the amount they are offering to pay for the lease extension. This figure is often significantly lower than the true market value. 

You can: 

• Dispute the leaseholder’s valuation and propose a higher premium. 

• Request a professional survey valuation to determine a realistic figure. 

• Negotiate a better deal before reaching the tribunal stage.

Under the Leasehold Reform Act 1993, the leaseholder is responsible for paying your reasonable legal and valuation costs. This includes: 

• Your solicitor’s fees for reviewing and responding to the Section 42 Notice. 

• The cost of a professional surveyor to assess the lease extension premium. 

We will work closely with your surveyor to maximise the end premium you receive whilst providing you with best-in-class advice at each stage. 

However, leaseholders are not required to pay for legal costs related to tribunal disputes, so early negotiation is key. 

Our team of leasehold solicitors provide clear, commercially driven advice to ensure you respond effectively to a Section 42 Notice or negotiate a voluntary lease extension on favourable terms. We will: 

• Review the leaseholder’s Initial Notice and assess your best course of action. 

• Work with expert surveyors to challenge undervalued premium offers. 

• Ensure your legal and valuation costs are properly recovered. 

• Manage all negotiations to secure the most advantageous outcome. 

We work closely with professional surveyors and valuers to ensure you achieve the highest possible lease extension premium. Our solicitors are skilled negotiators, whether through direct settlement discussions or, where necessary, representation in the First-tier Tribunal (Property Chamber). 

We provide specialist guidance whether you are responding to a Section 42 Notice or considering a voluntary lease extension. While the statutory process is structured by law, voluntary extensions allow for greater flexibility on terms, which can be advantageous to freeholders. We help you decide on the best approach based on your specific circumstances.

• Decades of experience advising freeholders, landlords, and investors. 

• Proven success in negotiating lease extensions at the highest possible premiums. 

• A team of specialist solicitors focused exclusively on leasehold property law.