Questions and Answers: Oldland leasehold conveyancing
My wife and I purchased a leasehold house in Oldland. Conveyancing and Leeds Building Society mortgage are in place. A letter has just been received from someone saying they have taken over the reversionary interest in the property. It included a ground rent demand for rent dating back to 1996. The conveyancing practitioner in Oldland who previously acted has long since retired.What should I do?
First contact HMLR to make sure that the individual purporting to own the freehold is indeed the new freeholder. It is not necessary to instruct a Oldland conveyancing practitioner to do this as you can do this on the Land Registry website for less than a fiver. Rest assured that in any event, even if this is the legitimate freeholder, under the Limitation Act 1980 the limitation period for recovery of ground rent is six years.
I am attracted to a two flats in Oldland which have about fifty years remaining on the lease term. Will this present a problem?
There are no two ways about it. A leasehold flat in Oldland is a wasting asset as a result of the shortening lease. The closer the lease gets to zero years unexpired, the more it adversely affects the value of the property. For most purchasers and banks, leases with less than 75 years become less and less attractive. On a more upbeat 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 a residence 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 Oldland 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 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.
I work for a busy estate agent office in Oldland where we have experienced a number of flat sales derailed due to short leases. I have been given contradictory information from local Oldland conveyancing firms. Can you shed some light as to whether the seller of a flat can instigate the lease extension process for the buyer?
Provided that 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. The benefit of this is that the proposed purchaser need not have to wait 2 years for a lease extension. Both sets of lawyers will agree to form of assignment. The assignment has to be done before, or simultaneously with completion of the disposal of the property.
An alternative approach is to agree the lease extension with the freeholder 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 purchaser.
What are your top tips when it comes to appointing a Oldland conveyancing practice to carry out our lease extension conveyancing?
If you are instructing a conveyancer for lease extension works (regardless if they are a Oldland conveyancing practice) it is imperative that he or she should be familiar with the legislation and specialises in this area of conveyancing. We suggested that you make enquires with several firms including non Oldland conveyancing practices before you instructing a firm. Where the conveyancing practice is ALEP accredited then so much the better. Some following of questions might be of use:
- How familiar is the firm with lease extension legislation?
Do you have any top tips for leasehold conveyancing in Oldland from the point of view of speeding up the sale process?
- Much of the frustration in leasehold conveyancing in Oldland can be reduced where you appoint lawyers the minute you market your property and ask them to collate the leasehold documentation which will be required by the buyers conveyancers.
- The majority freeholders or managing agents in Oldland charge for providing management packs for a leasehold homes. You or your lawyers should find out the actual amount of the charges. The management pack sought on or before finding a buyer, thus reducing delays. The average time it takes to obtain the necessary information is three weeks. It is the most common cause of delay in leasehold conveyancing in Oldland.
I invested in buying a 2 bed flat in Oldland, conveyancing having been completed 2005. Can you let me have an estimated range of the fair premium for a lease extension? Comparable properties in Oldland with over 90 years remaining are worth £216,000. The average or mid-range amount of ground rent is £55 invoiced every year. The lease runs out on 21st October 2083
With only 60 years unexpired the likely cost is going to be between £19,000 and £22,000 plus plus your own and the landlord's "reasonable" professional fees.
The suggested premium range that we have given is a general guide to costs for extending a lease, but we cannot give you the actual costs without more detailed due diligence. You should not use this information in a Notice of Claim or as an informal offer. There may be other concerns that need to be considered and you obviously should be as accurate as possible in your negotiations. Neither should you move forward placing reliance on this information before seeking the advice of a professional.