Swiss Cottage leasehold conveyancing: Q and A’s
I am tempted by the attractive purchase price for a couple of maisonettes in Swiss Cottage both have about 50 years remaining on the leases. Do I need to be concerned?
There is no doubt about it. A leasehold apartment in Swiss Cottage is a wasting asset as a result of the reducing lease term. The closer the lease gets to zero years unexpired, the more it adversely affects the value of the premises. For most buyers and mortgage companies, leases with under 75 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 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 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 Swiss Cottage conveyancing experts who will explain the options available to you during an initial telephone conversation free of charge. A more straightforward and quicker method of extending would be to contact your landlord directly and sound him out on the prospect of extending the lease You may find he or she is happy to negotiate informally and willing to consider your offer straight off, without having to involve anyone else. This will save you time and money and it could help you reach a lower price on the lease. 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.
Last month I purchased a leasehold house in Swiss Cottage. Do I have any liability for service charges relating to a period prior to completion of my purchase?
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. Strange as it may seem, 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 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).
Do you have any top tips for leasehold conveyancing in Swiss Cottage with the purpose of expediting the sale process?
- A significant proportion of the delay in leasehold conveyancing in Swiss Cottage can be reduced where you get in touch lawyers the minute you market your property and request that they start to put together the leasehold documentation needed by the purchasers’ conveyancers.
- Many landlords or managing agents in Swiss Cottage levy fees for providing management packs for a leasehold property. You or your lawyers should enquire as to the actual amount of the charges. The management information sought as soon as you have a buyer, thus reducing delays. The average time it takes to obtain the necessary information is three weeks. It is the most frequent reason for delay in leasehold conveyancing in Swiss Cottage.
Our conveyancer has advised that he intends to complete and exchange simultaneously on the sale of our £375000 apartment in Swiss Cottage next Friday . The freeholder has quoted £372 for Certificate of Compliance, insurance certificate and 3 years service charge statements. Is it legal for a freeholder to charge such fees for a leasehold conveyance in Swiss Cottage?
Swiss Cottage conveyancing on leasehold flats typically necessitates administration charges levied by management companies :
- Addressing pre-contract enquiries
- Where consent is required before sale in Swiss Cottage
- Supplying insurance information
- Deeds of covenant upon sale
- Registering of the assignment of the change of lessee after a sale
After years of dialogue we cannot agree with our landlord on how much the lease extension should cost for our flat in Swiss Cottage. Does the Leasehold Valuation Tribunal have jurisdiction to calculate the appropriate figures?
You certainly can. We are happy to put you in touch with a Swiss Cottage conveyancing firm who can help.
An example of a Lease Extension decision for a Swiss Cottage flat is First Floor Flat 20 Fitzjohns Avenue in July 2014. the Tribunal decided that the premiums to be paid for new leases in respect of the Raised Ground Floor Flat and the First Floor Flat were to be calculated as: Raised Ground Floor: £765,175.14 First Floor: £601,617.77 This case related to 2 flats. The unexpired term was 16.83 and 16.43.
What makes a Swiss Cottage lease problematic?
There is nothing unique about leasehold conveyancing in Swiss Cottage. All leases are individual and legal mistakes in the legal wording can result in certain provisions are erroneous. The following missing provisions could result in a defective lease:
- A provision to repair to or maintain elements of the building
- 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 could encounter a problem when selling your property if you have a defective lease primarily because it impacts on the ability to obtain a mortgage on the property. Santander, Chelsea Building Society, and Aldermore all have express 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 defective they may refuse to provide security, obliging the buyer to withdraw.
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