Grays leasehold conveyancing: Q and A’s
I am tempted by the attractive purchase price for a two flats in Grays both have in the region of fifty years left on the leases. Should I regard a short lease as a deal breaker?
There is no doubt about it. A leasehold flat in Grays is a deteriorating asset as a result of the reducing lease term. The closer the lease gets to its expiry date, the more it reduces the value of the premises. The majority of buyers and lenders, 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 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 Grays 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 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.
I am a negotiator for a long established estate agency in Grays where we have experienced a few flat sales jeopardised as a result of short leases. I have been given inconsistent advice from local Grays conveyancing solicitors. Can you shed some light as to whether the vendor of a flat can instigate the lease extension process for the buyer?
Provided that 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 buyer need not have 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 prior to, or at the same time as completion of the disposal of the property.
Alternatively, it may be possible 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 offer any advice when it comes to choosing a Grays conveyancing firm to carry out our lease extension conveyancing?
If you are instructing a property lawyer for lease extension works (regardless if they are a Grays conveyancing practice) it is essential that they be familiar with the legislation and specialises in this area of conveyancing. We recommend that you talk with several firms including non Grays conveyancing practices before you instructing a firm. If the firm is ALEP accredited then so much the better. Some following of questions might be of use:
- What volume of lease extensions has the firm carried out in Grays in the last twenty four months?
Can you provide any top tips for leasehold conveyancing in Grays with the aim of speeding up the sale process?
- Much of the frustration in leasehold conveyancing in Grays can be avoided if you get in touch lawyers the minute your agents start advertising the property and ask them to collate the leasehold information which will be required by the purchasers’ solicitors.
- Many landlords or managing agents in Grays levy fees for providing management packs for a leasehold premises. You or your lawyers should enquire as to the actual amount of the charges. The management pack sought as soon as you have a buyer, thus reducing delays. The average time it takes to receive management information is three weeks. It is the most usual reason for frustration in leasehold conveyancing in Grays.
If all goes to plan we aim to complete the disposal of our £325000 flat in Grays next Wednesday . The landlords agents has quoted £336 for Landlord’s certificate, building insurance schedule and previous years service charge statements. Is it legal for a freeholder to charge exorbitant fees for a flat conveyance in Grays?
Grays conveyancing on leasehold apartments normally results in administration charges invoiced by managing agents :
- Completing pre-exchange questions
- Where consent is required before sale in Grays
- Copies of the building insurance and schedule
- Deeds of covenant upon sale
- Registering of the assignment of the change of lessee after a sale
Following years of correspondence we simply can't agree with our landlord on how much the lease extension should cost for our flat in Grays. Can we issue an application to the Residential Property Tribunal Service?
in cases where there is a missing freeholder or where there is disagreement about what the lease extension should cost, under the Leasehold Reform, Housing and Urban Development Act 1993 you can apply to the First-tier Tribunal (Property Chamber) to make a decision on the price.
An example of a Lease Extension decision for a Grays flat is Various @ Colombus Square in January 2012. the Tribunal calculated the premiums to be paid for new leases for each of the flats in Mariners Walk to be £3822 and the premium to be paid for the new lease of 2 Knights Court to be £4439. This case was in relation to 13 flats. The the unexpired residue of the current lease was 76 years.