I am hoping to put an offer on a small detached house that seems to meet my requirements, at a reasonable figure which is making it all the more appealing. I have just discovered that the title is leasehold as opposed to freehold. I would have thought that there are issues buying a house with a leasehold title in Stepney. Conveyancing advisers have not yet been appointed. Will my lawyers set out the implications of buying a leasehold house in Stepney ?

The majority of houses in Stepney are freehold and not leasehold. In this scenario it’s worth having a local conveyancer used to dealing with such properties who can assist with the conveyancing process. it is apparent that you are purchasing in Stepney so you should seriously consider shopping around for a Stepney conveyancing practitioner and check that they have experience in transacting on leasehold houses. First you will need to check the number of years remaining. As a tenant you will not be entirely free to do whatever you want with the house. The lease will likely included provisions such as requiring the landlord’spermission to carry out alterations. You may also be required to pay a maintenance charge towards the upkeep of the estate where the property is located on an estate. Your solicitor will appraise you on the various issues.

Back In 2009, I bought a leasehold flat in Stepney. Conveyancing and Britannia mortgage went though with no issue. I have received a letter from someone claiming to own the reversionary interest in the property. It included a ground rent demand for rent dating back to 1998. The conveyancing solicitor in Stepney who previously acted has long since retired.Do I pay?

The first thing you should do is contact the Land Registry to make sure that this person is indeed the new freeholder. You do not need to incur the fees of a Stepney conveyancing practitioner to do this as you can do this on the Land Registry website for a few pound. Rest assured that in any event, even if this is the rightful landlord, under the Limitation Act 1980 no more than 6 years of rent can be collected.

I am looking at a couple of apartments in Stepney which have approximately 50 years unexpired on the lease term. Will this present a problem?

There is no doubt about it. A leasehold flat in Stepney is a deteriorating asset as a result of the shortening lease. The nearer the lease gets to its expiry date, the more it adversely affects the marketability of the premises. For most purchasers and mortgage companies, leases with under 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 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 Stepney 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 the agreed 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 property in Stepney. Am I liable to pay service charges for periods before my ownership?

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).

Do you have any advice for leasehold conveyancing in Stepney with the aim of expediting the sale process?

• Much of the delay in leasehold conveyancing in Stepney can be bypassed where you instruct lawyers as soon as your agents start advertising the property and request that they start to collate the leasehold documentation which will be required by the buyers lawyers.
• The majority landlords or managing agents in Stepney charge for providing management packs for a leasehold homes. You or your lawyers should find out the actual amount of the charges. The management information sought as soon as you have a buyer, thus accelerating the process. The average time it takes to receive management information is three weeks. It is the most usual cause of frustration in leasehold conveyancing in Stepney.
• If you have carried out any alterations to the property would they have required Landlord’s permission? In particular have you laid down wooden flooring? Most leases in Stepney state that internal structural changes or laying down wooden flooring calls for a licence issued by the Landlord consenting to such alterations. If you dont have the approvals to hand you should not communicate with the landlord without checking with your conveyancer in the first instance.
• If there is a history of any disputes with your freeholder or managing agents it is essential that these are settled prior to the flat being marketed. The purchasers and their solicitors will be reluctant to purchase a property where there is a current dispute. You may need to swallow your pride and discharge any arrears of service charge or resolve 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 are still duty bound to disclose particulars of the dispute to the purchasers, but it is clearly preferable to reveal the dispute as over rather than ongoing.
• If you are supposed to have a share in the freehold, you should make sure that you are holding the original share document. Arranging a replacement share certificate can be a time consuming formality and delays many a Stepney home move. If a new share certificate is needed, do contact the company director and secretary or managing agents (if applicable) for this as soon as possible.

I have given up trying to reach an agreement for a lease extension in Stepney. Can the Leasehold Valuation Tribunal adjudicate on premiums?

in cases where there is a missing landlord or if there is disagreement about what the lease extension should cost, under the relevant statutes you can apply to the First-tier Tribunal (Property Chamber) to decide the price payable.

An example of a Freehold Enfranchisement case for a Stepney premises is 12, 14 & 16 Hull Close in May 2010. the Tribunal determined that the premium payable for the acquisition of the freehold to the subject premises was the sum of £18,300 This case was in relation to 3 flats. The remaining number of years on the lease was 101.61 years.

Leasehold Conveyancing in Stepney - Sample of Queries before buying

It would be a good idea to find out if there is anything that is prohibited in the lease. By way of example it is very common in Stepney leases that pets are not permitted in in a block in Stepney. If you like the propertyin Stepney however your cat is not allowed to make the move with you then you will be faced hard compromise. Who manages the block? The prefered form of lease arrangement is where the freehold title is in the ownership of the leaseholders. In this scenario the leaseholders benefit from being in charge if their destiny and notwithstanding that a managing agent is often employed where it is larger than a house conversion, the managing agent retained by the leaseholders.