Guidance on Lease Extension and Freehold Premiums
The premium payable is one of the most important initial considerations for flat owners when deciding whether to commit to incurring professional costs around either the lease extension or enfranchisement process.
Calculating the premium is a complex assessment, and there are several factors to consider such as:
Unexpired Lease Term
The shorter the remaining lease term, the higher the premium is likely to be. We can find out what the actual unexpired term of your lease is from Land Registry if you are unsure.
A professional valuer should assess the property’s current unimproved market value, considering factors such as location, size, condition, leaseholder improvements and comparable property prices in the area. Most flat owners we speak to have a fairly good idea of what their flat is worth.
An onerous ground rent provision in your lease would increase the premium. We can review your lease to ascertain what ground rent is payable over the remaining lease term.
Hope Development Value
this is value based on the expectation of getting planning permission for the development of retained areas of the building belonging to the outgoing freeholder. This is a hugely contentious issue which is increasing the subject of First-tier property Tribunal litigation. We can review the building’ leases to detect at an early stage whether this issue is likely to arise in your claim.
Whilst will be recommending the instruction of ALEP accredited valuer to guide you on the precise premium payable, we are able to provide rough budgetary guidance on the cost of the process. Our guide should empower you to initiate the process with confidence on the time scales and likely overall cost.
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. Alternatively, email us at email@example.com