I am hoping to put an offer on a small detached house that appears to be perfect, at a great price which is making it more attractive. I have just discovered that the title is leasehold as opposed to freehold. I am assuming that there are issues purchasing a house with a leasehold title in Baldock. Conveyancing solicitors have are soon to be appointed. Will they explain the issues?

Most houses in Baldock are freehold and not leasehold. In this scenario it’s worth having a local solicitor who is familiar with the area can help the conveyancing process. We note that you are buying in Baldock so you should seriously consider looking for a Baldock conveyancing practitioner and be sure that they have experience in dealing with leasehold houses. First you will need to check the unexpired lease term. Being a leaseholder you will not be at liberty to do whatever you want to the property. The lease comes with conditions such as requiring the landlord’sconsent to conduct alterations. It may be necessary to pay a maintenance charge towards the upkeep of the estate where the house is located on an estate. Your conveyancer should advise you fully on all the issues.

I am tempted by the attractive purchase price for a couple of maisonettes in Baldock both have about forty five years remaining on the lease term. Should I regard a short lease as a deal breaker?

There are no two ways about it. A leasehold flat in Baldock is a wasting asset as a result of the reducing lease term. The closer the lease gets to its expiry date, the more it reduces the salability of the property. The majority of buyers and banks, leases with less than eighty years become less and less attractive. On a more positive note, leaseholders can extend their leases by serving a Section 42 Notice. One stipulation is that they must have owned the premises for two years (unlike a Section 13 notice for purchasing the freehold, when leaseholders can participate from day one of ownership). When successful, they will have the right to an extension of 90 years to the current term and ground rent is effectively reduced to zero. Before moving forward with a purchase of property with a short lease term remaining you should talk to a solicitor specialising in lease extensions and leasehold enfranchisement. We are are happy to put you in touch with Baldock conveyancing experts who will explain the options available to you during an initial telephone conversation free of charge. More often than not it is possible to negotiate informally with the freeholder to extend the lease They may agree to a smaller lump sum and an increase in the ground rent, but to shorter extension terms in return. You need to ensure that any new terms represent good long-term value compared with the standard benefits of the Section 42 Notice and that onerous clauses are not inserted into any redrafting of the lease.

Last month I purchased a leasehold property in Baldock. Am I liable to pay service charges relating to a period prior to completion of my purchase?

Where the service charge has already been demanded from the previous owner and they have not paid you would not usually be personally liable for the arrears. Strange as it may seem, your landlord may still be able to take action to forfeit the lease. It is an essential part of leasehold conveyancing for your conveyancer to ensure to have an up to date clear service charge receipt before completion of your purchase. If you have a mortgage this is likely to be a requirement of your lender.

If you purchase part way through an accounting year you may be liable for charges not yet demanded even if they relate to a period prior to your purchase. In such circumstances your conveyancer would normally arrange for the seller to set aside some money to cover their part of the period (usually called a service charge retention).

I work for a reputable estate agency in Baldock where we have witnessed a number of flat sales put at risk as a result of short leases. I have received conflicting advice from local Baldock conveyancing solicitors. Can you confirm whether the owner of a flat can start the lease extension process for the purchaser on completion of the sale?

Provided that the seller has owned the lease for at least 2 years it is possible, to serve a Section 42 notice to kick-start the lease extension process and assign the benefit of the notice to the purchaser. This means that the proposed purchaser need not have to wait 2 years for a lease extension. Both sets of lawyers will agree to form of assignment. The assignment has to be done prior to, or simultaneously with completion of the sale.

Alternatively, it may be possible to extend the lease informally by agreement with the landlord either before or after the sale. If you are informally negotiating there are no rules and so you cannot insist on the landlord agreeing to grant an extension or transferring the benefit of an agreement to the buyer.

What advice can you give us when it comes to appointing a Baldock conveyancing firm to deal with our lease extension?

If you are instructing a conveyancer for your lease extension (regardless if they are a Baldock conveyancing practice) it is imperative that they be familiar with the legislation and specialises in this area of conveyancing. We suggested that you make enquires with several firms including non Baldock conveyancing practices prior to instructing a firm. Where the conveyancing practice is ALEP accredited then so much the better. Some following of questions could be helpful:

• Can they put you in touch with client in Baldock who can give a testimonial?

I acquired a 1 bedroom flat in Baldock, conveyancing was carried out half a dozen years ago. Can you let me have an estimate of the premium that my landlord can legally expect in return for granting a renewal of my lease? Comparable properties in Baldock with a long lease are worth £260,000. The average or mid-range amount of ground rent is £55 levied per year. The lease ends on 21st October 2090

With 65 years left to run the likely cost is going to span between £17,100 and £19,800 as well as legals.

The suggested premium range above a general guide to costs for renewing a lease, but we are not able to supply a more accurate figure in the absence of detailed due diligence. You should not use this information in a Notice of Claim or as an informal offer. There may be other concerns that need to be considered and you obviously should be as accurate as possible in your negotiations. Neither should you move forward placing reliance on this information before getting professional advice.

Other Topics

Lease Extensions in Baldock