Leasehold Advisory Service new online calculator

The Leasehold Advisory Service has launched a new online calculator to help tenants and landlords estimate the likely premium payable for a statutory lease extension.

Leasehold property has been the subject of considerable attention in recent years, with various government ministers suggesting that the system may ultimately be abolished and replaced with commonhold. However, it seems unlikely that this will happen in the immediate future. While leasehold properties remain in existence, the remaining term of each lease will continue to reduce year by year.

If you own a leasehold property with fewer than 85 years remaining on the lease, you may wish to consider whether you are able to extend the term. In most cases, this will involve paying a premium to your landlord. The premium is the sum of money paid by a tenant to a landlord in exchange for buying additional years for the term of their lease. The amount of that premium is assessed by reference to a number of factors, but the Leasehold Advisory Service’s online calculator may provide a useful indication of the likely cost.

However, the calculator should be used only to obtain an indicative figure and should not be relied upon as formal advice. It may also not be appropriate for informal lease extensions, where more than the additional statutory 90 years may be added to the term and other lease terms may also be amended.

Whether you are a tenant seeking a lease extension or a landlord who has been asked to grant one, we strongly recommend obtaining detailed legal and valuation advice before proceeding.

With various legislative changes proposed by the government, it is essential that all parties involved in a lease extension are properly advised. If you are considering extending a lease, or if you have received a request for a lease extension, please do not hesitate to get in touch with our Real Estate team.