Can I Extend My Lease?

The eligibility criteria for a statutory lease extension are that you have been the owner of a long lease (one originally granted for 21 years or more) for at least two years.

The first stage of any claim is to check whether you qualify for a statutory lease extension because you must meet the eligibility criteria stipulated in the Leasehold Reform and Urban Development Act 1993.

The statutory process is only applicable to certain types of property ownership. To qualify for a statutory lease extension you must be the owner of a long lease (one which was originally granted for at least 21 years). Most leasehold flat owners fall into this category.

Furthermore you must have been the legal owner of the leasehold property for at least two years, which is a stumbling block for many people.

If you do not meet this requirement, however, there are two alternatives. The two year ownership eligibility can effectively be transferred from one owner to another. This means that when a property is being sold the benefit of the notice can be assigned to the new owner at the same time as the property itself. For this to work, the right must be transferred with the legal title to the property.

The other alternative is to make an informal agreement with the Landlord, also known as a non-statutory or voluntary lease extension. In this case the terms of the new lease must be negotiated between the freeholder and the leaseholder because there is no regulatory framework to govern the terms of agreement. A degree of caution is necessary with this approach, weighing up the deal against what could be achieved by statutory means.

In terms of other qualifying factors, only residential leases are eligible for a statutory lease extension because lessees of commercial premises are not counted as qualifying tenants under the 1993 Act. In the case of a mixed use property, the lease terms and the physical state of the property must be ascertained before deducing whether it counts as residential.

What is more, certain types of Landlords are considered exempt from complying with the 1993 Act. These exemptions include:

· Charitable housing trust companies (if the flat is provided by the charity as part of charitable work)

· The Crown Estate

· The National Trust

· Properties within the boundaries of a cathedral precinct

In some cases the landlords may still agree to an informal lease extension and still follow the spirit of the legislation, so the benefit of the statutory process is not entirely lost.

Written by Simon Masters

Senior Associate Solicitor