Dec
23
what happnes when a shop lease runs out?
By
Ive found a shop but lease ends march 2009. Does the lease then renew can rent rise drematically and catch me out? Ive had a lease before but was 999year lease so never had to worry- that though was on my flat not a commercial property which id imagne all have short leases. Unlikely but what would happen if I left early before the lease ended. I wont own the shop just rent
2nd question
My sister owns her shop but has a lease of 7 years or something if she sells when a lease only has say 2 years less would the shop value go down. She bought it for 80,000 just last year but would like to relocate?
Sorry I dont understand it all!! Please could make it obvious what question you are answering, cat xx
Quick Property Sale
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3 Comments
January 14th, 2010 at 10:20 am
You will have to renegotiate at the end of the lease. 3 years is enough to establish goodwill, regardless of location, but it is really a question for your professional advisers.
January 15th, 2010 at 7:56 am
Each lease hsas different small print, but basically one of the following WILL happen:
1) You will be invited by the landlord to enter a new lease – at an increased price
2) You will be asked to leave by the landlord
Re your sister’s property, it can be worth less or more – depends on what is actually happening in that local area. Only an estate agent would be able to advise that, but I’m sure a local estate agent would be pleased to give her a free estimate of value.
If you want to leave before the lease is finished, you will have to find a buyer. And you are still liable until the end date of the lease for the property in some way, such that, suppose the person you sold the lease too didn’t pay the ground rent, you might be liable to pay it.
You need to get a copy of the lease and speak to a solicitor. You can get a free chat with a solicitor by finding out (via Citizens Advice Bureaux) which local solicitors provide a “Free Law Surgery” and when/where.
At law surgeries solicitors offer free advice, you just turn up and queue.
Good luck.
January 18th, 2010 at 12:56 pm
Leases are always renegotiated at expiration.
Just the way it is. Current economy determines the rent.
If one leaves before a lease expires, the tenant will have to pay the balance of the lease. No way to avoid that.
Think about buying a place as it nears expiration.
Consider rent, gone, as opposed to investment.
The landlord has “NO OBLIGATION” to renew a lease.
When buying a business, the lease is always considered. A short lease or near expiring lease should be renegotiated by a buyer before committing.
If the shop value is reasonable, the lease term will be critical, else the buyer would be foolish to gamble on the lease not being renewed or renewed at an exorbitant rent.
READ THE EXISTING LEASE FOR ANY OPTIONS CONTAINED THEREIN.