Be careful, you may own a flat that you may not be able to sell. Many flats built in and around Watford in the 1960s and 1970s may now be unsaleable due to the length of their lease. Most lenders will not lend money on properties with less than 70 years remaining on a lease so unless you have a cash buyer, you may not be able to sell your flat. If you do find a buyer, the sale price could be considerably less than you would have hoped.

There are two routes you can take to extend your lease. The first being the statutory route which will guarantee you an extended lease of 90 years on top of your existing term and will reduce the ground rent to a peppercorn (in other words, there will be no ground rent payable) however you must fulfil specific criteria of which one is that you have owned the property for at least two years. The other is by negotiation with the landlord. If you were to negotiate separately then the extended term and ground rent can be anything which is agreed between you and your landlord but bear in mind, negotiations may fail and you may then be required to apply via the statutory route.

In both cases a premium, usually determined by a surveyor, will be payable to the landlord. It costs more to extend a lease when there is less than 80 years left.

The fewer years remaining on a lease, the greater the premium you will be charged for extending it. So if you do have a lease that is approaching 80 years or less, you should look into extending it regardless of whether you wish to sell the property or not.

  • This is for guidance only. We recommend that you take legal advice on your particular circumstances.