I’m about to sell my ground floor flat in Calstock.Conveyancing has not commenced but I have just received a yearly service charge invoice – should I leave it to the buyer to sort out?

Your conveyancing lawyer is likely to suggest that you should clear the service charge as normal because all ground rent and service charges will be apportioned on completion, so you will be reimbursed by the buyer for the period running from after the completion date to the next payment date. Most management companies will not acknowledge the buyer unless the service charges have been paid and are up to date so it is important for both buyer and seller for the seller to show that they are up to date. This will smooth the conveyancing process.

I today plan to offer on a house that appears to tick a lot of boxes, at a great figure which is making it all the more appealing. I have since been informed that it's a leasehold rather than freehold. I would have thought that there are particular concerns buying a house with a leasehold title in Calstock. Conveyancing solicitors have are about to be appointed. Will my lawyers set out the risks of buying a leasehold house in Calstock ?

The majority of houses in Calstock are freehold rather than 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 Calstock in which case you should be looking for a Calstock conveyancing solicitor and check that they are used to dealing with leasehold houses. First you will need to check the number of years remaining. Being a tenant you will not be entirely free to do whatever you want to the property. The lease will likely included provisions for example requiring the freeholder’spermission to conduct alterations. It may be necessary to pay a service charge towards the maintenance of the estate where the house is located on an estate. Your solicitor should advise you fully on all the issues.

I am tempted by the attractive purchase price for a couple of flats in Calstock both have approximately 50 years left on the lease term. Should I regard a short lease as a deal breaker?

There is no doubt about it. A leasehold apartment in Calstock is a deteriorating asset as a result of the shortening lease. The closer the lease gets to its expiry date, the more it reduces the marketability of the property. For most buyers and banks, leases with under 75 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 property 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 a residence 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 Calstock 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 the agreed 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.

I work for a reputable estate agency in Calstock where we have experienced a few leasehold sales jeopardised due to short leases. I have been given conflicting advice from local Calstock conveyancing firms. Can you shed some light as to whether the seller of a flat can initiate the lease extension process for the buyer?

As long as the seller has been the owner 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 can avoid having to sit tight for 2 years to extend their lease. Both sets of lawyers will agree to form of assignment. The assignment needs to be completed before, or simultaneously with completion of the sale.

An alternative approach is to agree the lease extension with the freeholder 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 purchaser.

Can you provide any top tips for leasehold conveyancing in Calstock from the point of view of expediting the sale process?

• A significant proportion of the frustration in leasehold conveyancing in Calstock can be avoided where you get in touch lawyers the minute your agents start advertising the property and request that they start to collate the leasehold information needed by the buyers conveyancers.
• In the event that you altered the property did you need the Landlord’s approval? Have you, for example laid down wooden flooring? Calstock leases often stipulate that internal structural changes or addition of wooden flooring calls for a licence from the Landlord consenting to such works. Where you dont have the paperwork in place do not contact the landlord without checking with your lawyer first.
• A minority of Calstock leases require Landlord’s consent to the sale and approval of the buyers. If this is the case, it would be prudent to notify your estate agents to make sure that the purchasers obtain financial (bank) and professional references. The bank reference should make it clear that the buyer is financially capable of paying the annual service charge and the actual amount of the service charge should be quoted in the bank’s letter. You will therefore need to provide your estate agents with the service charge figures so that they can pass this information on to the purchasers or their solicitors.
• If you have had conflict with your freeholder or managing agents it is essential that these are settled prior to the flat being marketed. The purchasers and their solicitors will be reluctant to purchase a property where there is a current dispute. You may have to bite the bullet and discharge any arrears of service charge or settle the dispute prior to completion of the sale. It is therefore preferable to have any dispute settled ahead of the contract papers being issued to the buyers’ solicitors. You will still have to reveal details of the dispute to the purchasers, but it is clearly preferable to reveal the dispute as historic as opposed to ongoing.
• If you hold a share in a the freehold, you should make sure that you are holding the original share certificate. Arranging a re-issued share certificate is often a lengthy formality and frustrates many a Calstock home move. If a duplicate share certificate is necessary, do contact the company officers or managing agents (where relevant) for this sooner rather than later.

Calstock Leasehold Conveyancing - A selection of Queries Prior to Purchasing

Are any of leasehold owners in arrears of their service charge liability?