Dereham leasehold conveyancing: Q and A’s
I have just appointed agents to market my ground floor apartment in Dereham.Conveyancing lawyers have not yet been instructed but I have just received a yearly maintenance charge invoice – should I leave it to the buyer to sort out?
Your conveyancing lawyer is likely to suggest that you should discharge 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 am tempted by the attractive purchase price for a couple of maisonettes in Dereham which have approximately forty five years unexpired on the leases. Will this present a problem?
There are no two ways about it. A leasehold flat in Dereham is a wasting asset as a result of the shortening lease. The closer the lease gets to its expiry date, the more it reduces the salability of the premises. The majority of buyers and mortgage companies, leases with less than eighty 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 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 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 Dereham conveyancing experts who will explain the options available to you during an initial telephone conversation free of charge. A more straightforward and quicker method of extending would be to contact your landlord directly and sound him out on the prospect of extending 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 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 busy estate agency in Dereham where we have experienced a few leasehold sales derailed due to short leases. I have been given conflicting advice from local Dereham conveyancing firms. Could you clarify whether the owner of a flat can start the lease extension formalities for the purchaser on completion of the sale?
As long as the seller has owned the lease for at least 2 years it is possible, to serve a Section 42 notice to start the lease extension process and assign the benefit of the notice to the purchaser. The benefit of this is that the buyer need not have to wait 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.
What advice can you give us when it comes to choosing a Dereham conveyancing firm to deal with our lease extension?
When appointing a property lawyer for lease extension works (regardless if they are a Dereham conveyancing firm) it is essential that they be familiar with the legislation and specialises in this area of conveyancing. We advise that you talk with two or three firms including non Dereham conveyancing practices before you instructing a firm. If the firm is ALEP accredited then so much the better. Some following of questions might be useful:
- How familiar is the firm with lease extension legislation?
If all goes to plan we aim to complete the sale of our £175000 maisonette in Dereham next week. The management company has quoted £396 for Landlord’s certificate, insurance certificate and previous years statements of service charge. Is it legal for a freeholder to charge exorbitant fees for a flat conveyance in Dereham?
Dereham conveyancing on leasehold maisonettes typically results in fees being levied by freeholders :
- Completing conveyancing due diligence questions
- Where consent is required before sale in Dereham
- Supplying insurance information
- Deeds of covenant upon sale
- Registering of the assignment of the change of lessee after a sale
I am the registered owner of a garden flat in Dereham, conveyancing formalities finalised in 2011. Can you shed any light on how much the price could be for a 90 year extension to my lease? Comparable flats in Dereham with an extended lease are worth £185,000. The average or mid-range amount of ground rent is £55 yearly. The lease runs out on 21st October 2106
You have 80 years left to run we estimate the premium for your lease extension to be between £10,500 and £12,000 plus professional fees.
The suggested premium range above a general guide to costs for renewing a lease, but we cannot give you 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 are no doubt other issues that need to be considered and clearly you want to be as accurate as possible in your negotiations. You should not take any other action placing reliance on this information without first getting professional advice.
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