Melbourne leasehold conveyancing Example Support Desk Enquiries
I am on look out for some leasehold conveyancing in Melbourne. Before diving in I would like to find out the remaining lease term.
If the lease is registered - and most are in Melbourne - then the leasehold title will always include the basic details of the lease, namely the date; the term; and the original parties. From a conveyancing perspective such details then enable any prospective buyer and lender to confirm that any lease they are looking at is the one relevant to that title.For any other purpose, such as confirming how long the term was granted for and calculating what is left, then the register should be sufficient on it's own.
I have just appointed agents to market my garden apartment in Melbourne.Conveyancing solicitors are to be appointed soon but I have just had a half-yearly service charge invoice – should I leave it to the buyer to sort out?
Your conveyancing lawyer is likely to suggest that you should clear the service charge 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 until 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 today plan to offer on a house that seems to be perfect, at a great figure which is making it all the more appealing. I have just been informed that it's a leasehold rather than freehold. I would have thought that there are particular concerns purchasing a house with a leasehold title in Melbourne. Conveyancing advisers have not yet been instructed. Will they explain the issues?
The majority of houses in Melbourne are freehold rather than leasehold. In this scenario it’s worth having a local conveyancer used to dealing with such properties who can help the conveyancing process. It is clear that you are purchasing in Melbourne so you should seriously consider looking for a Melbourne conveyancing solicitor and check that they have experience in advising on leasehold houses. First you will need to check the unexpired lease term. As a lessee you will not be entirely free to do whatever you want to the property. The lease will likely included provisions for example requiring the freeholder’sconsent to carry out alterations. It may be necessary to pay a service charge towards the upkeep of the estate where the property is located on an estate. Your lawyer will report to you on the legal implications.
I am tempted by the attractive purchase price for a couple of apartments in Melbourne both have approximately fifty 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 Melbourne is a deteriorating asset as a result of the shortening lease. The closer the lease gets to its expiry date, the more it reduces 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 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 property 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 Melbourne 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 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 employed by a reputable estate agency in Melbourne where we have experienced a number of leasehold sales put at risk as a result of short leases. I have received inconsistent advice from local Melbourne conveyancing firms. Could you clarify whether the seller of a flat can start the lease extension process for the buyer?
As long as 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. This means that the buyer need not have to sit tight for 2 years for a lease extension. Both sets of lawyers will agree to form of assignment. The assignment has to be done prior to, or at the same time as completion of the sale.
Alternatively, it may be possible 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.
Leasehold Conveyancing in Melbourne - A selection of Questions you should ask Prior to Purchasing
What is the service charge and ground rent on the property?
Does the lease include onerous restrictions?
Please inform me if there are any major works in the planning that will likely add a premium to the service costs?