Estate agents have just been given the go-ahead to market my garden apartment in Melbourne.Conveyancing solicitors are to be appointed soon but I have just received a quarterly maintenance charge demand – what should I do?

Your conveyancing lawyer is likely to suggest that you should pay the invoice 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 management companies 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. This will smooth the conveyancing process.

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 since discovered 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 are soon to be instructed. Will they explain the issues?

The majority of houses in Melbourne are freehold rather than leasehold. This is one of the situations where having a local conveyancer who is familiar with the area can assist with the conveyancing process. We note that you are buying in Melbourne so you should seriously consider shopping around for a Melbourne conveyancing practitioner and check that they have experience in advising on leasehold houses. First you will need to check the number of years remaining. Being a tenant you will not be at liberty to do whatever you want to the property. The lease comes with conditions such as requiring the landlord’spermission to conduct alterations. You may also be required to pay a service charge towards the maintenance of the estate where the house is part of an estate. Your lawyer will appraise you on the various issues.

Last month I purchased a leasehold flat in Melbourne. Do I have any liability for service charges relating to a period prior to completion of my purchase?

Where the service charge has already been demanded from the previous lessee 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).

I am employed by a busy estate agent office in Melbourne where we have witnessed a few flat sales derailed due to short leases. I have been given contradictory information from local Melbourne conveyancing solicitors. Can you confirm whether the owner of a flat can commence the lease extension formalities for the purchaser on completion of the sale?

As long as the seller has owned the lease for at least 2 years it is possible, to serve a Section 42 notice to commence the lease extension process and assign the benefit of the notice to the purchaser. The benefit of this is that the proposed purchaser need not have to sit tight for 2 years to extend their lease. Both sets of lawyers will agree to form of assignment. The assignment has to be done before, or simultaneously with completion of the sale.

An alternative approach is 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.

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

When appointing a property lawyer for your lease extension (regardless if they are a Melbourne conveyancing firm) it is imperative that he or she should be familiar with the legislation and specialises in this area of work. We recommend that you speak with two or three firms including non Melbourne conveyancing practices prior to instructing a firm. If the firm is ALEP accredited then that’s a bonus. Some following of questions might be helpful:

• What volume of lease extensions have they carried out in Melbourne in the last 12 months?
• Can they put you in touch with client in Melbourne who can give a testimonial?

Leasehold Conveyancing in Melbourne - Sample of Queries before buying

Where a Melbourne lease has no more than 80 years it will affect the salability of the apartment. Check with your mortgage company that they are willing to go ahead with the loan given the lease term. Leases with less than 80 years remaining means that you will most likely have to extend the lease sooner rather than later and you need to have some idea of how much this will be. For most Melbournelease extensions you will be be obliged to have owned the premises for two years before you are legally able to extend the lease. Who manages the building?