What is the difference between extending the lease and buying the freehold (or reversionary) interest?
Both rights to buy the freehold or extend the lease are statutory rights available to tenants of long leases (i.e. over 21 years) subject to a number of requirements. If a leaseholder wishes to extend the lease, he can do so on an individual basis as long as he had owned the property for at least two years. You would be able to extend the existing term by adding another 90 years. There is a formal procedure that must be followed, which includes serving a notice on the landlord. It is important that you instruct a competent solicitor to guide you through the process. For example, if the notice is inaccurate or incorrectly completed, it can be rejected as invalid. It can subsequently be amended by application to the county court, however, that is an expense that should be avoided at all costs. Any leaseholder who satisfies the above criteria can apply for a lease extension. You should bear in mind that you would need to carry out a valuation to determine the value of the lease extension.
