Leaseholders can often be put off applying for a lease extension if they have a difficult landlord, but when handled properly, it need not be a daunting process. Brady Solicitors’ Head of Leasehold Conveyancing, Lesley Brentnall explains.

Your statutory rights

Firstly, if you have owned your property for at least two years then you have a statutory right to a new lease. Your landlord has minimal grounds for refusing a lease extension (generally, only if they have clear plans to develop the site, which have to be proven to the Court), and so as long as the right is triggered correctly, even with the most difficult landlord, you are almost guaranteed to be granted an extension.

If you are in this position, you should bear in mind that the longer you delay making your application, the more expensive the process is likely to be.

What will a lease extension cost?

You are obliged to pay a premium for the extension and you also cover the landlord’s legal and valuation costs. But, the law dictates that these costs must be reasonable and the landlord can only claim for the costs of investigating your claim and the conveyancing process. They cannot claim for any time spent in negotiating the premium.

As to the premium itself, then clearly the landlord will want to try and obtain the highest payment they can, whilst you will want to limit yours. If agreement cannot be reached on this then the only option is to make an application to the First Tier Tribunal. This would increase your legal costs considerably, but if the matter goes to Tribunal, the position changes; each party is then generally liable for their own costs. There would need to be a significant discrepancy between your offer and the premium requested by the landlord to make it worth their while fighting the proposal, as otherwise any benefit they would gain by succeeding would be outweighed by the costs they would have to cover.

It is therefore usually in the interests of both parties to reach an agreement on premium before the matter has to go to Tribunal. In practice, we find it is very rare that such an application is required. The norm is that however difficult the freeholder, it is usually possible to reach agreement on an extension.

How to start the lease extension process

The first step is simply to trigger the extension by serving the notice to the landlord. Contact the leasehold conveyancing team at Brady Solicitors, who will gladly get the ball rolling for you and guide you through the rest of the process.

Click here for further information on lease extensions

Read more about Lesley’s experience of difficult lease extensions