Can you extend a lease with an absent freeholder?
Yes, it is possible to extend a lease even if the freeholder is absent. Leaseholders have the legal right to extend their lease under certain conditions, regardless of the freeholder's presence or involvement. Here are some key points to consider:
- Qualifying criteria: In order to qualify for a lease extension, you need to have owned the leasehold property for at least two years. This requirement is typically applicable in England and Wales, but it may vary in different jurisdictions.
- Statutory lease extension: Leaseholders have the right to request a statutory lease extension under the Leasehold Reform, Housing and Urban Development Act 1993 (in England and Wales). This allows leaseholders to extend their lease by an additional 90 years and reduce the ground rent to a peppercorn (nominal) amount.
- Formal notice: To initiate the lease extension process, you must serve a formal notice, known as a Section 42 Notice, on the absent freeholder or their representative. The notice outlines your intention to extend the lease and provides relevant details and proposed terms.
- Valuation and negotiation: Once the notice is served, the freeholder has a specified period to respond. A professional valuer may be appointed to determine the premium (the cost of the lease extension) based on various factors, including the property's value, remaining lease term, and other considerations. Negotiations may follow to agree on the premium and other terms.
- Legal process: If an agreement cannot be reached through negotiation, the leaseholder has the option to apply to the First-tier Tribunal (Property Chamber) to determine the premium and other terms of the lease extension.
It's important to note that the absence of the freeholder may complicate the lease extension process, particularly in terms of communication and obtaining necessary consents. However, there are legal procedures in place to enable leaseholders to extend their lease and protect their rights, even when the freeholder is absent. Seeking professional advice from a solicitor experienced in leasehold matters can help navigate the process and ensure compliance with legal requirements.