Top Five Questions relating to Burnt Oak leasehold conveyancing
I am tempted by the attractive purchase price for a two flats in Burnt Oak which have approximately forty five years remaining on the leases. Should I regard a short lease as a deal breaker?
There are no two ways about it. A leasehold flat in Burnt Oak is a wasting asset as a result of the reducing lease term. The closer the lease gets to zero years unexpired, the more it adversely affects the value of the property. The majority of purchasers and mortgage companies, leases with under 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 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 Burnt Oak 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 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 house in Burnt Oak. Do I have any liability for 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. A critical element 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 am employed by a long established estate agency in Burnt Oak where we see a number of flat sales jeopardised as a result of leases having less than 80 years remaining. I have received conflicting advice from local Burnt Oak conveyancing solicitors. Could you confirm whether the seller of a flat can start the lease extension formalities 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 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 sale.
An alternative approach is 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 purchaser.
Can you offer any advice when it comes to finding a Burnt Oak conveyancing practice to deal with our lease extension?
If you are instructing a solicitor for your lease extension (regardless if they are a Burnt Oak 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 several firms including non Burnt Oak conveyancing practices before you instructing a firm. If the firm is ALEP accredited then so much the better. Some following of questions could be useful:
- If they are not ALEP accredited then why not?
We expect to complete our sale of a £150000 maisonette in Burnt Oak on Wednesday in a week. The landlords agents has quoted £420 for Certificate of Compliance, insurance certificate and previous years statements of service charge. Is it legal for a freeholder to charge an administration fee for a flat conveyance in Burnt Oak?
Burnt Oak conveyancing on leasehold apartments normally involves the purchaser’s solicitor sending questions for the landlord to answer. Although the landlord is not legally bound to address these enquiries the majority will be content to do so. They are entitled invoice a reasonable administration fee for responding to enquiries or supplying documentation. There is no upper cap for such fees. The average fee for the information that you are referring to is £350, in some cases it is in excess of £800. The administration charge levied by the landlord must be accompanied by a synopsis of entitlements and obligations in relation to administration charges, without which the charge is not strictly payable. In reality you have little option but to pay whatever is requested of you should you wish to exchange contracts with the buyer.
I own a ground floor flat in Burnt Oak. In the absence of agreement between myself and the freeholder, can the Leasehold valuation Tribunal determine the sum due for a lease extension?
in cases where there is a absentee landlord 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 decide the sum to be paid.
An example of a Lease Extension matter before the tribunal for a Burnt Oak flat is 20 Orchard Court Stonegrove in June 2009. The tribunal decided that a premium of £11,040 should be payable for the new lease This case affected 1 flat. The the number of years remaining on the existing lease(s) was 71.55 years.