Common questions relating to Cirencester leasehold conveyancing
I am on look out for some leasehold conveyancing in Cirencester. Before I get started I would like to find out the number of years remaining on the lease.
Assuming the lease is recorded at the land registry - and most are in Cirencester - then the leasehold title will always include the basic details of the lease, namely the date; the term; and the original parties. From a conveyancing perspective such details then enable any prospective buyer and lender to confirm that any lease they are looking at is the one relevant to that title.For any other purpose, such as confirming how long the term was granted for and calculating what is left, then the register should be sufficient on it's own.
Having checked my lease I have discovered that there are only Seventy years left on my lease in Cirencester. I am keen to get lease extension but my freeholder is absent. What are my options?
On the basis that you qualify, under the Leasehold Reform, Housing and Urban Development Act 1993 you can apply to the County Court for for permission to dispense with the service of the initial notice. This will enable the lease to be extended by the Court. However, you will be required to demonstrate that you have used your best endeavours to find the landlord. On the whole a specialist may be useful to try and locate and to produce an expert document which can be accepted by the court as proof that the freeholder can not be located. It is wise to seek advice from a conveyancer both on investigating the landlord’s disappearance and the application to the County Court covering Cirencester.
I am looking at a couple of apartments in Cirencester which have approximately forty five years remaining on the lease term. Will this present a problem?
There is no doubt about it. A leasehold flat in Cirencester is a deteriorating asset as a result of the reducing lease term. The nearer the lease gets to its expiry date, the more it reduces the value of the property. The majority of buyers and mortgage companies, leases with under 75 years become less and less marketable. 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 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 Cirencester 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 You may find he or she is happy to negotiate informally and willing to consider your offer straight off, without having to involve anyone else. This will save you time and money and it could help you reach a lower price on the lease. 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 flat in Cirencester. Do I have any liability for service charges for periods before 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. However, 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 be sure 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 am employed by a busy estate agency in Cirencester where we see a number of leasehold sales jeopardised due to short leases. I have received conflicting advice from local Cirencester conveyancing firms. Please can you shed some light as to whether the seller of a flat can start the lease extension formalities for the purchaser on completion of the sale?
Provided that the seller has been the owner for at least 2 years it is possible, to serve a Section 42 notice to commence the lease extension process and assign the benefit of the notice to the purchaser. This means that the proposed purchaser need not have to sit tight for 2 years for a lease extension. Both sets of lawyers will agree to form of assignment. The assignment needs to be completed before, or simultaneously with completion of the disposal of the property.
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.
I bought a studio flat in Cirencester, conveyancing formalities finalised 4 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? Similar flats in Cirencester with an extended lease are worth £257,000. The ground rent is £65 invoiced every year. The lease ends on 21st October 2098
With only 75 years left to run we estimate the premium for your lease extension to span between £10,500 and £12,000 as well as professional fees.
The figure that we have given is a general guide to costs for extending a lease, but we are not able to supply the actual costs without more detailed due diligence. Do not use the figures in a Notice of Claim or as an informal offer. There are no doubt other issues that need to be considered and clearly you want to be as accurate as possible in your negotiations. Neither should you move forward placing reliance on this information before getting professional advice.