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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3671
Experience:  Solicitors 2 years plus PQE
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I am the freeholder of a house converted into two flats. The

Customer Question

I am the freeholder of a house converted into two flats. The ground floor has been sold on a lease. The leaseholder is currently selling the flat and wants me to increase the lease by 15 years from 84yrs to 99yrs. How much should I charge him for an extension and would I be better off selling him a share of the freehold.
Submitted: 3 years ago.
Category: Law
Expert:  Alex J. replied 3 years ago.
Hi,

Thank you for your question and welcome.

My name is AJ and I will assist you.

If you want to agree a price with the tenant you will have to have the flat properly valued by a valuer. What you should do is agree to appoint an independent valuer and accept his valuation. What they do is work out what is known as the "Marriage Value" which is essentially the increase in value following the extension of the lease. If you cannot agree a fee it will under up in the Leasehold Valuation Tribunal which will incur unrecoverable costs.

You may find it easier just to sell him a share of the freehold but you would still be part freeholder and would still have to deal with the lease extension albeit without money being paid. The advantage of this would be that you would have someone to share the management responsibilities with. I would note that if you do sell a share of the freehold make sure you grant the other flat (if that is your flat) a 999 year lease.

If you require any information in the future there is a free Government backed services on this - http://www.lease-advice.org/

Kind regards

AJ