There are many reasons why you should extend your lease. Please see below for the main reason.
- As a lease gets shorter the value of the lease decreases and it becomes more expensive to extend the lease.
- To enable your property to be used for mortgage security (most lenders will not accept flats or houses held on leases with less than 55 years remaining on the lease and some even require no less than 75 years unexpired)
- To improve your property’s saleability. Sometimes it is difficult to sell a property with a short lease because mortgage lenders may be reluctant to lend money on such properties.
- To avoid having to pay marriage value (payable when extending a lease with a term of less than 80 years)
- To potentially remove the annual ground rent
A lease is a right to use the property for a period of time. This is why it is often a good idea to increase the term of the lease.