Questions and Answers: Soho leasehold conveyancing
My wife and I may need to sub-let our Soho basement flat temporarily due to a career opportunity. We instructed a Soho conveyancing practice in 2003 but they have closed and we did not have the foresight to seek any guidance as to whether the lease prohibits the subletting of the flat. How do we find out?
Some leases for properties in Soho do contain a provision to say that subletting is only allowed with permission. The landlord cannot unreasonably refuse but, in such cases, they would need to see references. Experience suggests that problems are usually caused by unsatisfactory tenants rather than owner-occupiers and for that reason you can expect the freeholder to take up the references and consider them carefully before granting consent.
I have just started marketing my 2 bed flat in Soho.Conveyancing lawyers have not yet been instructed but I have just received a quarterly service charge demand – should I leave it to the buyer to sort out?
It best that you clear the invoice as normal because all ground rent and service charges will be apportioned on completion, so you will be reimbursed by the buyer for the period running from after the completion date to the next payment date. Most managing agents will not acknowledge the buyer unless the service charges have been paid and are up to date so it is important for both buyer and seller for the seller to show that they are up to date. Having a clear account will assist your cause and will leave you no worse off financially.
I own a leasehold flat in Soho. Conveyancing and Bank of Ireland mortgage are in place. A letter has just been received from someone saying they have taken over the freehold. Attached was a demand for arrears of ground rent dating back to 1993. The conveyancing practitioner in Soho who previously acted has now retired.What should I do?
First make enquiries of HMLR to be sure that the individual claiming to own the freehold is in fact the registered owner of the freehold reversion. You do not need to incur the fees of a Soho conveyancing firm to do this as it can be done on-line for less than a fiver. You should note that in any event, even if this is the rightful landlord, under the Limitation Act 1980 the limitation period for recovery of ground rent is six years.
I work for a reputable estate agency in Soho where we have experienced a number of leasehold sales put at risk as a result of short leases. I have been given conflicting advice from local Soho conveyancing firms. Could you clarify whether the vendor of a flat can initiate the lease extension formalities for the purchaser on completion of the sale?
As long as 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. The benefit of this is that the proposed purchaser can avoid having to wait 2 years to extend their lease. 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 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.
I am the registered owner of a second floor flat in Soho. In the absence of agreement between myself and the freeholder, can the Leasehold valuation Tribunal determine the sum due for the purchase of the freehold?
You certainly can. We can put you in touch with a Soho conveyancing firm who can help.
An example of a Freehold Enfranchisement decision for a Soho residence is 20 Avonwick Road in July 2013. The Tribunal was dealing with an application under Section 26 of the Leasehold Reform Housing and Urban Development Act 1993 for a determination of the freehold value of the property. It was concluded that the price to be paid was Fifteen Thousand Nine Hundred and Seventy (£15,970) divided as to £8,200 for Flat 20 and £7,770 for Flat 20A This case related to 1 flat. The the number of years remaining on the existing lease(s) was 73.26 years.
Are there common problems that you come across in leases for Soho properties?
Leasehold conveyancing in Soho is not unique. All leases are individual and drafting errors can result in certain clauses are not included. For example, if your lease is missing any of the following, it could be defective:
- Repairing obligations to or maintain elements of the premises
- A duty to insure the building
- Clauses dealing with recovering service charges for expenditure on the building or common parts.
- Service charge per centages that don't add up correctly leaving a shortfall
A defective lease can cause issues when trying to sell a property primarily because it impacts on the ability to obtain a mortgage on the property. Lloyds TSB Bank, Barnsley Building Society, and Britannia all have express requirements when it comes to what is expected in a lease. Where a lender has been advised by their lawyers that the lease is defective they may refuse to provide security, forcing the buyer to withdraw.