I own a leasehold flat in Melbourne. Conveyancing and Leeds Building Society mortgage are in place. A letter has just been received from someone claiming to own the reversionary interest in the property. Attached was a ground rent demand for rent dating back to 1994. The conveyancing solicitor in Melbourne who acted for me is not around.Any advice?

First make enquiries of the Land Registry to be sure that this person is indeed the registered owner of the freehold reversion. There is no need to incur the fees of a Melbourne conveyancing lawyer to do this as it can be done on-line for a few pound. Rest assured that regardless, even if this is the legitimate landlord, under the Limitation Act 1980 the limitation period for recovery of ground rent is six years.

I am tempted by the attractive purchase price for a two flats in Melbourne both have about forty five years left on the lease term. Will this present a problem?

There is no doubt about it. A leasehold flat in Melbourne is a deteriorating asset as a result of the shortening lease. The closer the lease gets to zero years unexpired, the more it reduces the value of the premises. For most buyers and mortgage companies, leases with under eighty 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 Melbourne 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 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 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.

Can you offer any advice when it comes to choosing a Melbourne conveyancing firm to carry out our lease extension conveyancing?

If you are instructing a property lawyer for your lease extension (regardless if they are a Melbourne conveyancing practice) it is imperative that they be familiar with the legislation and specialises in this area of conveyancing. We suggested that you make enquires with two or three firms including non Melbourne conveyancing practices before you instructing a firm. Where the conveyancing practice is ALEP accredited then that’s a bonus. Some following of questions could be useful:

• How experienced is the practice with lease extension legislation?

Do you have any top tips for leasehold conveyancing in Melbourne with the purpose of speeding up the sale process?

• A significant proportion of the frustration in leasehold conveyancing in Melbourne can be reduced if you get in touch lawyers as soon as you market your property and ask them to put together the leasehold information which will be required by the buyers representatives.
• In the event that you altered the property did you need the Landlord’s consent? Have you, for example laid down wooden flooring? Melbourne leases often stipulate that internal structural changes or installing wooden flooring require a licence from the Landlord approving such changes. If you dont have the approvals to hand you should not contact the landlord without contacting your lawyer first.

When it comes to leasehold conveyancing in Melbourne what are the most frequent lease defects?

There is nothing unique about leasehold conveyancing in Melbourne. Most leases are individual and drafting errors can sometimes mean that certain provisions are missing. For example, if your lease is missing any of the following, it could be defective:

• A provision to repair to or maintain elements of the building
• A duty to insure the building
• A provision for the recovery of money spent for the benefit of another party.
• Maintenance charge proportions which don’t add up to the correct percentage

You will 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. Accord Mortgages Ltd, Norwich and Peterborough Building Society, and Britannia all have express conveyancing instructions when it comes to what is expected in a lease. If a mortgage lender believes that the lease is defective they may refuse to grant the mortgage, obliging the purchaser to withdraw.

I purchased a leasehold flat in Melbourne, conveyancing formalities finalised in 1997. Can you let me have an estimated range of the fair premium for a lease extension? Similar flats in Melbourne with a long lease are worth £230,000. The ground rent is £60 charged once a year. The lease terminates on 21st October 2090

With just 65 years left to run we estimate the price of your lease extension to range between £14,300 and £16,400 as well as costs.

The suggested premium range above a general guide to costs for extending a lease, but we are not able to advice on a more accurate figure without more comprehensive due diligence. You should not use this information in tribunal or court proceedings. There may be additional concerns that need to be considered and you obviously should be as accurate as possible in your negotiations. You should not move forward based on this information without first getting professional advice.

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Lease Extensions in Melbourne