I am tempted by the attractive purchase price for a two apartments in Clerkenwell both have about 50 years remaining on the leases. Will this present a problem?

There are no two ways about it. A leasehold flat in Clerkenwell 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 buyers and banks, leases with less than eighty years become less and less marketable. On a more upbeat 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 Clerkenwell 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.

I've recently bought a leasehold house in Clerkenwell. Am I liable to pay service charges for periods before completion of my purchase?

In a situation 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 work for a reputable estate agency in Clerkenwell where we have experienced a few flat sales jeopardised as a result of short leases. I have received inconsistent advice from local Clerkenwell conveyancing firms. Could you confirm whether the owner of a flat can commence the lease extension process for the buyer?

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 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 at the same time as 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.

If all goes to plan we aim to complete the disposal of our £ 275000 apartment in Clerkenwell next week. The management company has quoted £<Macro 'feeRangeWithVAT'> for Certificate of Compliance, insurance certificate and 3 years statements of service charge. Is the landlord entitled to charge exorbitant fees for a flat conveyance in Clerkenwell?

Clerkenwell conveyancing on leasehold apartments usually necessitates the purchaser’s conveyancer sending enquiries for the landlord to answer. Although the landlord is not legally bound to respond to these enquiries the majority will be content to do so. They may levy a reasonable charge for answering enquiries or supplying documentation. There is no set fee. The average fee for the information that you are referring to is £350, in some transactions it exceeds £800. The administration charge demanded by the landlord must be sent together with a summary of rights and obligations in respect of administration fees, without which the charge is technically not due. In reality you have little choice but to pay whatever is demanded if you want to sell the property.

I am the proprietor of a ground flat in Clerkenwell. In the absence of agreement between myself and the landlord, can the Leasehold valuation Tribunal make a decision on the premium payable for the purchase of the freehold?

Where there is a absentee landlord or if there is dispute 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 determine the premium.

An example of a Lease Extension case for a Clerkenwell property is Flat 89 Trinity Court Grays Inn Road in February 2013. the Tribunal found that the premium to be paid by the tenant on the grant of a new lease, in accordance with section 56 and Schedule 13 to the Leasehold Reform, Housing and Urban Development Act 1993 should be £36,229. This case affected 1 flat. The the number of years remaining on the existing lease(s) was 66.8 years.

What makes a Clerkenwell lease unacceptable for security purposes?

There is nothing unique about leasehold conveyancing in Clerkenwell. All leases are individual and drafting errors can result in certain provisions are erroneous. For example, if your lease is missing any of the following, it could be defective:

• Repairing obligations to or maintain elements of the building
• A duty to insure the building
• 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

You will encounter a problem when selling your property if you have a defective lease primarily because it impacts on the ability to obtain a mortgage on the property. Yorkshire Building Society, Leeds Building Society, and Nottingham Building Society all have express requirements when it comes to what is expected in a lease. If a mortgage lender believes that the lease does not cover certain provisions they may refuse to provide security, obliging the purchaser to pull out.

I invested in buying a studio flat in Clerkenwell, conveyancing formalities finalised 7 years ago. Can you let me have an estimated range of the fair premium for a lease extension? Corresponding properties in Clerkenwell with an extended lease are worth £197,000. The average or mid-range amount of ground rent is £60 levied per year. The lease comes to an end on 21st October 2086

You have 60 years remaining on your lease the likely cost is going to range between £20,000 and £23,000 as well as professional fees.

The suggested premium range above a general guide to costs for extending a lease, but we cannot give you the actual costs without more detailed due diligence. You should not use this information in a Notice of Claim or as an informal offer. There are no doubt other concerns that need to be taken into account and you obviously want to be as accurate as possible in your negotiations. Please do not take any other action based on this information before getting professional advice.