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Deptford leasehold conveyancing: Q and A’s

My partner and I may need to let out our Deptford 1st floor flat temporarily due to a career opportunity. We instructed a Deptford conveyancing practice in 2001 but they have since shut and we did not think at the time seek any guidance as to whether the lease allows us to sublet. How do we find out?

The lease dictates the relationship between the landlord and you the leaseholder; specifically, it will indicate if subletting is prohibited, or permitted but only subject to certain conditions. The accepted inference is that if the lease contains no specific ban or restriction, subletting is permitted. Most leases in Deptford do not contain subletting altogether – such a clause would undoubtedly devalue the flat. Instead, there is usually simply a requirement that the owner notifies the freeholder, possibly sending a copy of the tenancy agreement.

Having checked my lease I have discovered that there are only 68 years remaining on my flat in Deptford. I am keen to get lease extension but my landlord is absent. What should I do?

If you qualify, under the Leasehold Reform, Housing and Urban Development Act 1993 you can apply to the County Court for for permission to dispense with the service of the initial notice. This will enable the lease to be granted an extra 90 years by the Court. However, you will be required to demonstrate that you have made all reasonable attempts to find the lessor. In some cases an enquiry agent may be useful to carry out a search and to produce a report which can be accepted by the court as evidence that the landlord can not be located. It is wise to seek advice from a solicitor in relation to devolving into the landlord’s absence and the vesting order request to the County Court covering Deptford.

Last month I purchased a leasehold property in Deptford. Am I liable to pay 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. However, your landlord may still be able to take action to forfeit the lease. A critical element 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 am employed by a reputable estate agency in Deptford where we have experienced a few flat sales jeopardised as a result of leases having less than 80 years remaining. I have received inconsistent advice from local Deptford conveyancing solicitors. Please can you clarify whether the seller 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 buyer can avoid having to sit tight for 2 years for a lease extension. 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 sale.

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.

Can you provide any top tips for leasehold conveyancing in Deptford from the point of view of speeding up the sale process?

  • Much of the delay in leasehold conveyancing in Deptford can be avoided if you instruct lawyers as soon as you market your property and request that they start to collate the leasehold documentation needed by the buyers lawyers.
  • Many freeholders or Management Companies in Deptford levy fees for supplying management packs for a leasehold premises. You or your lawyers should enquire as to the fee that they propose to charge. The management pack can be applied for as soon as you have a buyer, thus reducing delays. The typical amount of time it takes to receive management information is three weeks. It is the most common cause of frustration in leasehold conveyancing in Deptford.
  • A minority of Deptford leases require Licence to Assign from the landlord. If this applies to your lease, it would be prudent to notify your estate agents to make sure that the purchasers obtain financial (bank) and professional references. The bank reference should make it clear that the buyer is financially capable of paying the annual service charge and the actual amount of the service charge should be quoted in the bank’s letter. You will therefore need to provide your estate agents with the service charge figures so that they can pass this information on to the purchasers or their solicitors.
  • If you have had any disputes with your landlord or managing agents it is essential that these are settled prior to the flat being put on the market. The purchasers and their solicitors will be reluctant to purchase a property where there is an ongoing dispute. You may have to bite the bullet and discharge any arrears of service charge or settle the dispute prior to the buyers completing the purchase. It is therefore preferable to have any dispute settled ahead of the contract papers being issued to the buyers’ solicitors. You will still have to reveal particulars of the dispute to the buyers, but it is clearly preferable to reveal the dispute as over as opposed to unsettled.
  • If you have the benefit of shareholding in the Management Company, you should make sure that you hold the original share certificate. Arranging a re-issued share certificate is often a time consuming formality and slows down many a Deptford conveyancing transaction. Where a new share is necessary, you should approach the company officers or managing agents (if applicable) for this sooner rather than later.

  • My wife and I have hit a brick wall in trying to purchase the freehold in Deptford. Can this matter be resolved via the Leasehold Valuation Tribunal?

    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 Leasehold Valuation Tribunal to decide the price.

    An example of a Freehold Enfranchisement decision for a Deptford flat is 41 Endwell Road in March 2013. this matter relateed to the acquisition of the freehold of a mid- terraced Victorian house converted into three separate self-contained dwellings. By an order dated 28/11/2012, Deputy District Judge Cole in the Bromley County Court held that the leaseholders were entitled to acquire the freehold and directed that the premium payable be determined by this Tribunal. The Tribunal assessed the premium to be £14,753 This case related to 3 flats. The remaining number of years on the lease was 80.01 years.