Extending Your Lease – Why Acting Early Could Save You Thousands

Birmingham’s vibrant property market, from the heritage-rich Jewellery Quarter to the modern skyline around Colmore Row, is home to countless leasehold properties.

Whilst many leaseholders in the city navigate the ins and outs of leasehold ownership, the challenge of a short lease is often underestimated until it’s too late. Extending your lease early isn’t just a practical move — it’s a financial safeguard that can protect your property’s value and marketability.

Daniel Stones, Director of Colmore Business District based business Davisons Law on Colmore Row, explained: “A lease is essentially a timer on your home’s value. Once the lease term falls below 80 years, the financial implications can be substantial, from reduced saleability to increased lease extension costs. Acting early is important, especially in a city like Birmingham where leasehold properties are a cornerstone of the housing market.”

Subject to certain criteria, leaseholders in England and Wales have the statutory right to extend their lease under the Leasehold Reform, Housing and Urban Development Act 1993. Under the statutory process leaseholders are entitled to a further 90 years added to the remaining term of the existing lease. Ground rent also reduces to zero under the new lease.

However, navigating the intricacies of this process requires professional expertise. 

“At Davisons Law we guide clients through the entire journey—from valuation to negotiation to completion —ensuring leaseholder rights are protected and the process runs as smoothly as possible,” Daniel added.

The financial cost of extending a lease involves several factors, including the premium paid to the landlord, legal fees and valuation costs. For properties in Birmingham, where the market is dynamic and competitive, the benefits often far outweigh these expenses. “A longer lease not only secures your home’s value but also makes it more attractive to potential buyers or lenders. It’s an investment in both your property’s future and your peace of mind,” Daniel said.

With Davisons Law’s flagship office in Colmore Row, the firm is uniquely positioned to offer Birmingham-centric advice. 

Daniel added: “We understand the nuances of the city centre market and our deep connections with property professionals allow us to provide tailored support. Our goal is to simplify complex legal processes and empower our clients to make informed decisions.” 

Leaseholders face difficult decisions as to whether to proceed with lease extensions now rather than continue to wait for the delayed and much anticipated leasehold reforms. 

The changes are intended to simplify and reduce costs for lease extensions and will have a bearing on the premiums and costs payable in connection with lease extensions. Whilst the timeline remains uncertain Daniel said: “It is important leaseholders speak to us and one of our recommended valuers for guidance on the leasehold reforms.”     

At Davisons Law, we pride ourselves on delivering expert guidance with a client-first approach. Whether you’re nearing the critical 80-year mark or planning to sell your property, our team is here to help. 

“Extending your lease isn’t just about the legal process—it’s about securing your home’s value for years to come,” Daniel said. 

For a free initial assessment, contact their Colmore Row office or visit www.davisons.law.