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Aug 6th, 2022
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How to Clean label in the Lease Extension Agreement

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a lease extension gives the tenant the opportunity to extend the previous lease beyond the date which the previous lease would have expired attendance right to extend the lease should be expressly stated in the lease the extension terms usually follow the same terms as the previous lease agreement and it should state that all the terms remain the same from the previous agreement otherwise it may be deemed a new lease if not explicitly identified in an extension the option to extend it should include terms for the extension the rent amount if there is any increase in rent and a clause stating that this agreement is a continuation of the rights and options from the previous lease the tenant must provide written notice that he or she intends to extend the lease by the time stated in the extension offer

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As the lease gets shorter and the number of years goes lower, the value of the lease decreases and it becomes more expensive when you extend the lease. This is why it is often a good idea to increase the term of the lease especially if you want to sell the property.
Youll need to pay for a valuer to estimate the price of your lease extension and negotiate with your freeholder on your behalf. Youll also need to pay a lawyer to review your updated lease and register it at the Land Registry. You can use a separate valuer and lawyer, or use a company that does it all under one roof.
The informal route is where the leaseholder simply contacts their landlord (usually the freeholder) to try and negotiate a lease extension. There are no rules if the leaseholder uses this route and the landlord could refuse to extend their lease, or could ask whatever price they like for doing so.
There are two ways to get a lease extension: The first is to serve a notice claiming your legal right, known as a statutory or formal lease extension. The second is to simply agree a deal with your freeholder, known as an informal lease extension.
An option to renew or extend the lease means that upon the tenants exercise of the option (choice), the provisions of the agreed-upon option are adopted for another defined term. The terms of the option can include the length of the new term, a change in rent, and other modifications.
A lease extension can apply to residential or commercial real estate properties. It allows tenants to remain on premises after their original lease has recently expired. A lawyer should review this agreement to ensure that it is fair and legally binding for both parties.
The distinction between extension and renewal is chiefly that in the case of renewal, a new lease is required while in the case of extension the same lease continues in force during the additional period by the performance of the stipulated act.
This is calculated as the amount of ground rent the landlord would have received for the remaining period of the existing lease (the term) and the extra 90 years the landlord will have to wait until ownership of the property will return to them (the reversion value).

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