Frequently asked questions relating to New Addington leasehold conveyancing
I am attracted to a couple of flats in New Addington both have in the region of fifty years remaining on the leases. Should I regard a short lease as a deal breaker?
There is no doubt about it. A leasehold flat in New Addington is a wasting asset as a result of the shortening lease. The nearer the lease gets to its expiry date, the more it adversely affects the value of the property. The majority of buyers and mortgage companies, leases with less than eighty years become less and less attractive. 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 a residence 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 New Addington 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 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've recently bought a leasehold flat in New Addington. Am I liable to pay service charges for periods before my ownership?
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 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 New Addington where we see a number of flat sales put at risk due to leases having less than 80 years remaining. I have been given contradictory information from local New Addington conveyancing solicitors. Please can you confirm whether the vendor of a flat can initiate the lease extension process for the buyer?
Provided that 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. This means that the buyer can avoid having to sit tight for 2 years to extend their lease. Both sets of lawyers will agree to form of assignment. The assignment has to be done before, or at the same time as completion of the disposal of the property.
An alternative approach is 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.
Can you offer any advice when it comes to finding a New Addington conveyancing practice to deal with our lease extension?
When appointing a solicitor for your lease extension (regardless if they are a New Addington conveyancing practice) it is most important that he or she should be familiar with the legislation and specialises in this area of work. We recommend that you speak with two or three firms including non New Addington conveyancing practices before you instructing a firm. If the firm is ALEP accredited then that’s a bonus. Some following of questions might be useful:
- If they are not ALEP accredited then what is the reason?
I inherited a garden flat in New Addington. Given that I can not reach agreement with the landlord, can the Leasehold valuation Tribunal make a decision on the amount due for the purchase of the freehold?
Where there is a missing freeholder or where there is dispute about the premium for a lease extension, under the relevant legislation you can apply to the First-tier Tribunal (Property Chamber) to make a decision on the premium.
An example of a Freehold Enfranchisement case for a New Addington property is The Woodlands 95 Purley Park Road in April 2009. The Tribunals own valuation produced the figure of £37,912. This case related to 6 flats. The the unexpired term as at the valuation date was 78.32 years.
When it comes to leasehold conveyancing in New Addington what are the most frequent lease problems?
Leasehold conveyancing in New Addington is not unique. All leases are unique and drafting errors can result in certain provisions are missing. For example, if your lease is missing any of the following, it could be defective:
- A provision to repair to or maintain elements of the property
- 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
A defective lease can cause problems when trying to sell a property primarily because it impacts on the ability to obtain a mortgage on the property. Halifax, Chelsea Building Society, and Godiva Mortgages Ltd all have very detailed conveyancing instructions when it comes to what is expected in a lease. Where a lender has been advised by their lawyers that the lease is problematic they may refuse to provide security, obliging the buyer to pull out.