What Is a Concurrent Lease?
A concurrent lease is a lease granted over a property that already has an existing lease in place. The two leases run at the same time, hence "concurrent." In legal terms, this is also known as a "lease of the reversion" because the new lease is carved out of the freeholder's reversionary interest rather than replacing the original lease.
For residential flat owners in England and Wales, this can mean you hold two separate leases on the same property. You might discover this when checking your title at HM Land Registry, or when your conveyancer flags it during a sale or remortgage. It can look alarming, but it is a recognised legal structure with a clear purpose.
Why Do I Have Two Leases on My Flat?
The vast majority of residential lease extensions are done through what is known as "surrender and regrant," where your old lease is cancelled and a brand new, longer lease is granted in its place. HM Land Registry processes tens of thousands of these applications every year. It is the standard approach.
However, in some cases a freeholder (or their solicitor) will instead grant a new, longer lease alongside your existing one rather than replacing it. Your original lease stays untouched. The new concurrent lease sits on top of it. This is typically done for tax reasons: a surrender and regrant can trigger Stamp Duty Land Tax (SDLT) and Capital Gains Tax consequences for the freeholder, and a concurrent lease avoids those triggers. The practical result for you is that you can continue to occupy your flat for the extended term. But on paper, you now hold two leases registered under separate title numbers at Land Registry.
There are other ways concurrent leases arise too. In some developments, the freeholder grants individual flat leases to buyers and then grants a concurrent lease over the block to a management company. That concurrent lease gives the management company the right to collect ground rent and manage the building on the freeholder's behalf.
How a Concurrent Lease Works
Think of your property interests as layers. At the bottom is the freehold, owned by the freeholder. Your original lease is one layer above that. The concurrent lease is another layer, sitting alongside it.
The practical outcome is that you can continue to live in your flat for the longer term. However, the two leases are legally distinct interests with potentially different terms, covenants and conditions, which can cause complications. Your original lease still expires at its original date. After that, the concurrent lease continues under its own terms. Mortgage lenders may not view two separate lease titles as equivalent to one clean extended lease. This is why merging them into a single lease is advisable.
How a Concurrent Lease Affects Selling or Mortgaging
If you are selling your flat or remortgaging, having two leases can raise questions during the conveyancing process. HM Land Registry itself acknowledges that concurrent leases registered under separate title numbers with the same owner "may be confusing for those subsequently dealing with the title." A buyer's solicitor may flag this as unusual and want it resolved before completion.
Where both interests are held by the same person in the same capacity, you can apply to HM Land Registry to merge them into a single title. This closes one title and leaves you with one clean lease. Merger is not automatic: it requires an application and lenders may prefer the leases to be merged for simplicity.
It is worth merging sooner rather than later. If left unresolved and new conveyancers are involved later who are unfamiliar with the position, it can cause unnecessary delays.
Concurrent Leases and Lease Extensions
If you already hold a concurrent lease and are thinking about extending further, your statutory rights under the Leasehold Reform, Housing and Urban Development Act 1993 still exist. However, the mechanics of exercising those rights when you hold both the lease and the immediate reversion can be more complex than a standard extension. The identification of the competent landlord and the calculation of the lease extension premium may be affected by the concurrent lease structure.
This is an area where specialist advice is important. A lease extension professional will ensure the correct process is followed and the Section 42 notice is served on the right party.
It is also worth noting that if you or other leaseholders in your building later pursue collective enfranchisement (buying the freehold together), any concurrent lease must be acquired as part of that process. This is a requirement under the 1993 Act and can affect the cost of the enfranchisement claim.
In Summary
A concurrent lease means two leases running at the same time on the same flat. Key points to remember:
- It usually arises because a lease extension was structured this way for tax efficiency rather than through surrender and regrant
- You can continue to live in your flat for the longer term, but the two leases are legally distinct interests with potentially different terms
- The two leases should ideally be merged into one at HM Land Registry, particularly before a sale or remortgage
- If you want to extend further, the concurrent lease structure can add complexity, so specialist advice is important
If you are thinking about extending your lease or have questions about your title, get your free lease extension estimate to understand your options.
