Q I live in a Victorian house that has been converted into five flats. I bought my flat several years ago and own 20% of the freehold. The lease on my flat is now less than 80 years, and understandably I want to extend the lease. The managing agent told all the leaseholders last year that he would take action to extend the leases but has done nothing about it and does not respond to my emails. He is not an easy person to do business with. There is also no point me contacting the other freeholders as the person who owns 60% of the freehold would be uncooperative, as I have successfully prevented him converting the garage attached to the house into a residential dwelling.
Is there anything I can do to extend the leasehold? (I am reluctant to employ a lawyer as their services are so expensive.) I understand that new legislation will shortly come before parliament which will make it easier for leaseholders to extend their leases. Should I simply wait for the legislation to be passed?
GL
A No. I wouldn’t wait for the legislation to be passed because it won’t make any difference to your situation. The main aim of the proposed new laws concerning leasehold properties is to make it easier and quicker to extend the lease on a property particularly on leasehold houses which are now banned from being sold on that basis.
If you were simply the leaseholder of your flat, after you have owned it for two years, you would have the automatic right to extend your lease by 90 years for a fair price. However once there are less than 80 years left on the lease, you not only have to pay the usual lease extension price but also half what’s called the “marriage value” which is the amount of extra value that extending the lease would add to your property.
But the fact that you also own a share of the freehold of your building means – apart from legal costs – you don’t have to pay to extend your lease and can extend it to 999 years. The major downside to owning a share of the freehold is that all the other freeholders have to agree that you can extend your lease as you can’t do so without their agreement. So you’ll have to think of a way winning over the other freeholder whose garage conversion plans you put a stop to, as well as the person who owns the remaining 20% of the freehold.
