As a tenant, you may at some point need to consider extending your lease agreement with your landlord. While the process may seem straightforward, there are important factors that come into play when extending a lease agreement. Here’s everything you need to know.
What is a lease agreement extension?
A lease agreement extension is when a tenant and a landlord agree to continue their lease agreement beyond its original expiry date. This is a common occurrence in the property industry, as it allows tenants to continue to occupy a property, while landlords can ensure a steady stream of rental income.
Why extend your lease agreement?
There are a number of reasons why a tenant might want to extend their lease agreement. Perhaps they have found the perfect location for their business or are unable to find alternative premises. Alternatively, the tenant may have made significant improvements to the property and wish to continue to reap the benefits of these improvements.
Whatever the reason, it’s important to note that extending a lease agreement is not always straightforward, especially if the landlord has other plans for the property.
Key considerations when extending a lease agreement
There are a number of key considerations to take into account when extending a lease agreement. These include:
Negotiating the right terms: When extending a lease agreement, it’s important to ensure that the terms are favourable to the tenant. This could include things like a rent freeze, a shorter notice period or even an opportunity to purchase the property at a later date.
Timing: Timing is crucial when it comes to extending a lease agreement. Ideally, tenants should start the negotiation process at least a year before their lease is due to expire. This gives both parties enough time to negotiate the most favourable terms.
Legal advice: It’s always advisable to seek legal advice when negotiating a lease agreement extension. A solicitor will be able to advise on the legalities of the agreement, as well as help negotiate favourable terms for the tenant.
How to extend your lease agreement
To extend your lease agreement, you’ll need to contact your landlord and express your interest in continuing the lease. From here, negotiations will take place to determine the terms of the agreement.
It’s important to note that extending a lease agreement is not always a straightforward process. The landlord may have other plans for the property, or they may want to increase the rent amount. In some cases, the tenant may need to pay a premium to extend the lease agreement.
In conclusion, extending a lease agreement can be a useful way for tenants to continue to occupy a property. However, it’s important to take key considerations into account, including negotiating favourable terms and seeking legal advice. If you’re considering extending your lease agreement, be sure to start the process early and be prepared to negotiate to ensure you get the best possible terms.