Newsflash – Proposed Leasehold Reform and Lease Extensions
On 07 January 2021 the Housing Secretary Robert Jenrick announced proposals that mean leaseholders will be able to extend their lease by 990 years instead of the current 90 years allowed by the Leasehold Reform, Housing and Urban Development Act 1993, and for those with lease lengths below 80 years, removal of marriage value which can make premiums very costly.
Currently this announcement is just a press release and is not detailed. The question for leaseholders is whether they should extend their lease now under the current legislation or whether they should hold off and wait for the new 990 year extension and removal of the expensive marriage value.
We do not know when the legislation will be passed but it could be another 1 to 4 years before it is and by that time the premium is likely be more expensive than it would today, given the likely increase in property value over that time. So unless you have a short lease term where the premium would currently include a significant amount made up of marriage value then you may decide to proceed now with your lease extension.
Machins have a team specialising in lease extension and enfranchisement and can assist both freeholders and leaseholders through the process.
Contact Janice Young or Eugene Pritchard