Whether you need a solicitor extend your lease is a common question, and one we look to explain in this article.
It is tempting to ask how to serve a section 42 notice or whether your own valuation is really necessary, to keep expenses down in a world of the ever increasing cost of living. However their is a real risk of being taken advantage of by a savvy freeholder, unless you seek proper legal counsel and valuation advice.
In this post, we look at why it is important to be properly advised by your own lawyer and valuer rather than relying on the goodwill of your freeholder to offer a fair deal. The theme throughout our advice is that you should expect your freeholder to have the benefit of advice and be seeking the best possible deal; negotiating without your own advice, over something that affects your biggest asset, is full of risks.
If you are concerned that your freeholder could be difficult to deal with, do not be concerned, we have handled section 42 notices against the most difficult freeholders and offer a fixed legal fee for peace of mind.
When should I start the process?
This is very much dictated by the market and mortgage companies. For example, it can be difficult to sell a lease with less than 100 years remaining, because a buyer will be wary of the cost and time to resolve the issue after they have purchased (although it is now possible for a a buyer to start the process without waiting to years, following the changes in March 2025).
Some mortgage companies will not offer a mortgage against a lease with less than 90 years remaining, or with a lease containing a doubling ground rent, and in either case a statutory lease extension will be necessary to:
add 90 years to the lease; and
reduce the ground rent to a peppercorn
What role does my leasehold solicitor play?
Your solicitor will firstly ensure that you qualify to extend the lease. An experienced advisor will then guide you through the process by:
organising a valuation with an experienced valuer
preparing the s.42 notice
investigating if there are any issues that will arise, such as missing landlord, unauthorised alterations to the flat or dissolved freehold companies that will complicate the process (this is where an enfranchisement specialist earns their keep, over a conveyancer dabbling in this process)
serving the section 42 notice on the landlord and any other party by law
being a point of contact for arranging the inspection by the freeholders surveyor, paying the statutory deposit and evidencing title to the freeholders solicitors
receiving the section 45 counter notice, containing the freeholders offer, checking this for validity
advising you on the counter notice and how best to proceed in your specific circumstances, for example does the counter notice require onerous new clauses to be contained in the new lease?
liaising with your valuer and keeping an eye on the all important statutory deadlines to ensure the claim is not deemed withdrawn
reviewing the draft lease, making amendments and arranging for you to sign
completion; organising funds and putting priority searches in place
finally, registration at the Land Registry
Please note that this is just an outline, distilling over ten years of experience of handling lease extensions into a short guidance article.
There will be a number of checks and investigations that your leasehold lawyer will be undertaking without it being obvious. The hallmark of a good legal advisor is that they don't burden you with the details but do explain the important parts of the process in plain English.
Who else is involved?
Alongside your leasehold lawyer, you will need an leasehold valuer. This is usually a surveyor that specialises in leasehold matters. We are commonly asked if an estate agents valuation can be used however this is a totally different type of valuation.
Estate agents valuation = valuation of the flat as a whole using local knowledge and current market rates
Lease extension valuation = much more complicated prescribed procedure under the Leasehold Reform, Housing and Urban Development Act 1993 which values the amount payable to the freeholder (s) for the loss of its right to take the flat back at the end of the lease, and to compensate the landlord for the lost ground rent once this is replaced with a peppercorn.
Solicitor and author at Peppercorn Law, Ricky Coleman argues that "most solicitors with experienced in this area will have a list of contacts, whether its a leasehold valuer or lease plan company, who can assist with the non-legal parts of the process. In areas with a high number of flats such as Brighton, there is a concentration of experts in this area, who thanks to modern ways of working can easily work for clients based nationwide or overseas".
Leasehold reforms in 2025
Leaseholders should keep a close eye on announcements by the government, which is making changes to this area of law including the removal of the two year rule and expected removal of marriage value. If you are affected by any of the issues set out in this article, our founder Ricky Coleman would be pleased to discuss your options. Peppercorn Law offers a fixed fee lease extension service which you can read about here.