Estate agents have just been given the go-ahead to market my 2 bed apartment in Melbourne.Conveyancing solicitors are to be appointed soon but I have just had a yearly service charge demand – what should I do?

The sensible thing to do is pay 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 unless 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 am hoping to put an offer on a small detached house that appears to tick a lot of boxes, at a great figure which is making it all the more appealing. I have just discovered that it's a leasehold as opposed to freehold. I am assuming that there are issues purchasing a leasehold house in Melbourne. Conveyancing solicitors have not yet been instructed. Will they explain the issues?

Most houses in Melbourne are freehold rather than leasehold. This is one of the situations where having a local solicitor used to dealing with such properties who can assist with the conveyancing process. it is apparent that you are buying in Melbourne so you should seriously consider looking for a Melbourne conveyancing solicitor and check that they have experience in dealing with leasehold houses. As a matter of priority you will need to check the unexpired lease term. Being a leaseholder you will not be at liberty to do whatever you want with the house. The lease comes with conditions for example requiring the landlord’sconsent to conduct alterations. It may be necessary to pay a contribution towards the maintenance of the estate where the house is located on an estate. Your conveyancer will advise you fully on all the issues.

I've recently bought a leasehold property in Melbourne. Am I liable to pay service charges for periods before 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. 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 Melbourne with the aim of speeding up the sale process?

• Much of the frustration in leasehold conveyancing in Melbourne can be reduced where you get in touch lawyers as soon as your agents start marketing the property and request that they start to collate the leasehold information needed by the purchasers’ conveyancers.
• The majority landlords or managing agents in Melbourne 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 obtain the necessary information is three weeks. It is the most frequent cause of delay in leasehold conveyancing in Melbourne.

If all goes to plan we aim to complete our sale of a £225000 flat in Melbourne on Wednesday in a week. The management company has quoted £360 for Landlord’s certificate, insurance certificate and 3 years service charge statements. Is it legal for a freeholder to charge such fees for a leasehold conveyance in Melbourne?

Melbourne conveyancing on leasehold maisonettes usually requires the buyer’s lawyer sending enquiries for the landlord to address. Although the landlord is under no legal obligation to answer such questions the majority will be content to do so. They are entitled levy a reasonable administration fee for answering enquiries or supplying documentation. There is no upper cap for such fees. The average fee for the information that you are referring to is over three hundred pounds, in some cases it is in excess of £800. The management information fee demanded by the landlord must be sent together with a synopsis of rights and obligations in respect of administration fees, otherwise the invoice is not strictly payable. In reality one has no option but to pay whatever is demanded if you want to sell the property.

Leasehold Conveyancing in Melbourne - A selection of Questions you should consider before buying

In the main the cost for major works are not included within service charges, albeit that a few managing agents in Melbourne obliged tenants to contribute towards a sinking fund created for the specific purpose of building a fund for major works. Make sure you investigate if there is anything that is prohibited in the lease. By way of example plenty of leases prohibit pets being permitted in certain buildings in Melbourne. If you like the flatin Melbourne but your dog can’t move with you then you will be faced difficult choice. How many of the leaseholders are in arrears for their maintenance charge payments?

Other Topics

Lease Extensions in Melbourne