Canary Wharf leasehold conveyancing: Q and A’s
I've found a house that appears to be perfect, at a great price which is making it all the more appealing. I have subsequently found out that it's a leasehold as opposed to freehold. I am assuming that there are particular concerns buying a house with a leasehold title in Canary Wharf. Conveyancing advisers have are about to be appointed. Will my lawyers set out the risks of buying a leasehold house in Canary Wharf ?
Most houses in Canary Wharf are freehold rather than leasehold. This is one of the situations where having a local conveyancer who is familiar with the area can assist with the conveyancing process. We note that you are buying in Canary Wharf so you should seriously consider shopping around for a Canary Wharf conveyancing practitioner and be sure that they have experience in dealing with leasehold houses. First you will need to check the unexpired lease term. Being a leaseholder you will not be at liberty 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 contribution towards the upkeep of the communal areas where the house is part of an estate. Your conveyancer should advise you fully on all the issues.
I am a negotiator for a busy estate agency in Canary Wharf where we have witnessed a few leasehold sales derailed as a result of short leases. I have been given contradictory information from local Canary Wharf conveyancing solicitors. Can you confirm whether the owner of a flat can start the lease extension process 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 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 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 buyer.
What advice can you give us when it comes to appointing a Canary Wharf conveyancing firm to deal with our lease extension?
When appointing a conveyancer for lease extension works (regardless if they are a Canary Wharf conveyancing firm) it is essential that he or she should be familiar with the legislation and specialises in this area of conveyancing. We suggested that you talk with two or three firms including non Canary Wharf 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 experienced is the practice with lease extension legislation?
Do you have any top tips for leasehold conveyancing in Canary Wharf from the point of view of expediting the sale process?
- Much of the delay in leasehold conveyancing in Canary Wharf can be bypassed if you instruct lawyers the minute you market your property and ask them to put together the leasehold documentation needed by the buyers lawyers.
- The majority freeholders or Management Companies in Canary Wharf charge for supplying management packs for a leasehold homes. You or your lawyers should discover the fee that they propose to charge. The management pack sought as soon as you have a buyer, thus accelerating the process. The average time it takes to obtain the necessary information is three weeks. It is the most common reason for frustration in leasehold conveyancing in Canary Wharf.
I have had difficulty in seeking a lease extension in Canary Wharf. Can this matter be resolved via the Leasehold Valuation Tribunal?
if there is a absentee freeholder or where there is disagreement about what the lease extension should cost, under the Leasehold Reform, Housing and Urban Development Act 1993 it is possible to make an application to the Leasehold Valuation Tribunal to judgment on the premium.
An example of a Freehold Enfranchisement decision for a Canary Wharf property is 12, 14 & 16 Hull Close in May 2010. the Tribunal determined that the premium payable for the acquisition of the freehold to the subject premises was the sum of £18,300 This case affected 3 flats. The unexpired lease term was 101.61 years.
What makes a Canary Wharf lease unmortgageable?
Leasehold conveyancing in Canary Wharf is not unique. All leases are individual and drafting errors can sometimes mean that certain provisions are erroneous. The following missing provisions could result in a defective lease:
- Repairing obligations to or maintain elements of the premises
- Insurance obligations
- Clauses dealing with recovering service charges for expenditure on the building or common parts.
- Maintenance charge proportions which don’t add up to the correct percentage
A defective lease will likely cause problems when trying to sell a property as they can affect a potential buyer’s ability to obtain a mortgage. Accord Mortgages Ltd, Skipton Building Society, and Bank of Ireland all have express conveyancing instructions when it comes to what is expected in a lease. If a mortgage lender believes that the lease is defective they may refuse to grant the mortgage, forcing the purchaser to pull out.