I am looking at a two apartments in St Luke's which have about forty five years left on the lease term. Should I regard a short lease as a deal breaker?

There are no two ways about it. A leasehold apartment in St Luke's is a deteriorating asset as a result of the reducing lease term. The closer the lease gets to zero years unexpired, the more it reduces the marketability of the property. For most buyers and banks, leases with under eighty years become less and less attractive. 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 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 premises 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 St Luke's 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 am a negotiator for a long established estate agency in St Luke's where we have witnessed a few flat sales jeopardised due to short leases. I have received contradictory information from local St Luke's conveyancing firms. Can you confirm whether the vendor of a flat can initiate the lease extension process for the buyer?

Provided that the seller has been the owner 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 prior to, or at the same time as completion of the disposal of the property.

An alternative approach is 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.

Do you have any advice for leasehold conveyancing in St Luke's from the perspective of expediting the sale process?

• A significant proportion of the delay in leasehold conveyancing in St Luke's can be bypassed where you instruct lawyers the minute your agents start advertising the property and ask them to collate the leasehold information needed by the purchasers’ representatives.
• The majority landlords or Management Companies in St Luke's charge for providing management packs for a leasehold premises. You or your lawyers should enquire as to the actual amount of the charges. The management information can be applied for as soon as you have a buyer, thus reducing delays. The average time it takes to receive management information is three weeks. It is the most frequent reason for frustration in leasehold conveyancing in St Luke's.
• If you have carried out any alterations to the premises would they have required Landlord’s approval? In particular have you installed wooden flooring? St Luke's leases often stipulate that internal structural changes or laying down wooden flooring require a licence from the Landlord approving such alterations. Should you fail to have the approvals in place do not contact the landlord without contacting your solicitor in the first instance.
• If there is a history of conflict with your freeholder or managing agents it is very important that these are resolved prior to the flat being put on the market. The purchasers and their solicitors will be reluctant to purchase a flat where there is an ongoing dispute. You may have to bite the bullet and pay any arrears of service charge or resolve the dispute prior to completion of the sale. It is therefore preferable to have any dispute settled prior to the contract papers being issued to the buyers’ solicitors. You will still have to reveal details of the dispute to the buyers, but it is clearly preferable to present the dispute as historic as opposed to unsettled.
• You believe that you know the number of years remaining on your lease but it would be wise to double-check via your conveyancers. A purchaser's lawyer will not be happy to advise their client to to exchange contracts if the lease term is under 75 years. It is therefore important at an as soon as possible that you consider whether the lease requires a lease extension. If it does, contact your solicitors before you put your premises on the market for sale.

Our conveyancer has advised that he intends to complete and exchange simultaneously on the sale of our £ 125000 apartment in St Luke's in 5 days. The management company has quoted £<Macro 'feeRangeWithVAT'> for Landlord’s certificate, insurance certificate and previous years statements of service charge. Is the landlord entitled to charge an administration fee for a flat conveyance in St Luke's?

St Luke's conveyancing on leasehold apartments normally necessitates the purchaser’s lawyer submitting questions for the landlord to address. Although the landlord is under no legal obligation to address such questions the majority will be content to assist. They are entitled levy a reasonable administration fee for responding to enquiries or supplying documentation. There is no upper cap for such fees. The average costs for the information that you are referring to is £350, in some cases it exceeds £800. The management information fee required by the landlord must be sent together with a synopsis of entitlements and obligations in relation to administration fees, otherwise the invoice is technically not due. In reality you have little option but to pay whatever is demanded if you want to exchange contracts with the buyer.

I have attempted and failed to negotiate with my landlord to extend my lease without success. Can a leaseholder make an application to the Leasehold Valuation Tribunal? Can you recommend a St Luke's conveyancing firm to represent me?

You certainly can. We are happy to put you in touch with a St Luke's conveyancing firm who can help.

An example of a Lease Extension case for a St Luke's flat is 137 & 139 Haberdasher Street in December 2013. The Tribunal determines in accordance with section 48 and Schedule 13 of the Leasehold Reform, Housing and Urban Development Act 1993 that the premium for the extended lease for each Property should be £12,350.00. This case related to 2 flats. The remaining number of years on the lease was 72.39 years.

When it comes to leasehold conveyancing in St Luke's what are the most common lease problems?

Leasehold conveyancing in St Luke's is not unique. Most leases is drafted differently and legal mistakes in the legal wording can sometimes mean that certain clauses are erroneous. For example, if your lease is missing any of the following, it could be defective:

• Repairing obligations to or maintain parts of the property
• 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

You may have difficulties when selling your property if you have a defective lease primarily because it impacts on the ability to obtain a mortgage on the property. HSBC Bank, Bank of Scotland, and Britannia 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 withdraw.

St Luke's Conveyancing for Leasehold Flats - Sample of Questions you should consider before buying

Generally speaking the cost for major works tend not to be built into the maintenance charges, albeit that a few managing agents in St Luke's require tenants to contribute towards a reserve fund and this is used to offset against major works. If a St Luke's lease has less than 80 years it will have adverse implications on the value of the apartment. Check with your lender that they are willing to to proceed given the lease term. A short lease means that you will most likely have to extend the lease sooner rather than later and it is worth finding out how much this will be. For most St Luke'slease extensions you would be be obliged to have been the owner of the property for a couple of years before you are entitled to extend the lease.