Section 42 Notice and Section 45 Notice

Section 42 Notice (Initial Notice)

At South East Leasehold, we specialise in all leasehold matters, working with clients across London, Brighton, and East and West Sussex. Once you decide that you would like to formally apply for a leasehold extension, our team of surveyors and solicitors can guide you through the steps.

The Section 42 Notice, also known as the Initial Notice, is the most crucial part of the lease extension procedure. When you are ready with a valuation figure, your Solicitor will serve the Notice on the Freeholder and anyone else with an interest in the property, such as intermediate leaseholder or management company.

The Notice stipulates the amount you are offering to pay along with other details, such as the 90-year extension and the “Nil” ground rent to which you are entitled under the Act. It’s important to note that the date of service will be the valuation date, so no matter how long the lease extension takes, proceedings will always come back to the same date. Increases in house prices do not affect the valuation after the date, and your lease does not get any shorter.

The Freeholder will respond with a Section 45 Notice or Counter Notice.

The serving of the Section 42 Notice brings both the Act into force and its strict timetable of actions, which must be complied with or else a deed withdrawal will be deemed to have taken place. Serving a Section 42 Notice is not a hostile act against the freeholder, and is perfectly common and normal. In fact, most freeholders do not respond meaningfully to a leasehold extension application until after a Notice is served.

In the majority of cases, the lease extension premium is agreed and the matter proceeds to completion. One of the main advantages of a formal Notice is that ultimately you will have a resolution to the procedure at the tribunal, although tribunal hearings for lease extensions are actually quite rare.

Our team is comprised of Chartered Surveyors and qualified Solicitors that are highly experienced in the Leasehold Reform Act, and how it affects freeholders and leaseholders. For more information or a free consultation regarding leasehold extensions in Brighton, London or anywhere in the South East, please contact us today.

Section 45 Notice (Counter Notice)

The Section 45 Notice, or Counter Notice, is the freeholder’s response to the Section 42 notice. On receipt of the Section 42 Notice, the freeholder has 2 months to prepare and send a Section 45 Notice back to the leaseholder, offering complete acceptance of the terms, complete rejection, or a counter proposal, including a revised premium and any other terms that they would like to include.

It is unusual, but sometimes the freeholder will accept the Section 42 notice and no Section 45 notice is required. To deny the tenant’s claim entirely, the freeholder must believe that the tenant is not eligible for a statutory lease extension.

In most cases, the section 45 notice premium will be higher than the Section 42 notice premium, and at this stage the two surveyors will start the negotiation process to agree the premium. Once agreed, the matter is completed, provided the terms of the lease are also agreed.

The serving of the Section 45 Notice also starts the rest of the legislative timetable, such as a limit of 6 months to make a tribunal application and 2 months before the application can be made.

South East Leasehold assist freeholders and leaseholders across Sussex with leasehold extension and collective enfranchisement claims. Our team consists of in-house Solicitors and Chartered Surveyors, offering a uniquely effective opportunity to manage the process from start to finish, including valuations, Section 42 Notices and Section 45 Notices.

For more information about how our friendly team of professionals could assist with your property in London, Brighton or anywhere else in the South East, please call us on 0208 832 9069 or complete a form on our Contact Us page.

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