Paignton leasehold conveyancing: Q and A’s
I have just started marketing my ground floor apartment in Paignton.Conveyancing solicitors are to be appointed soon but I have just had a quarterly service charge demand – Do I pay up?
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 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. This will smooth the conveyancing process.
I am hoping to put an offer on a small detached house that seems to be perfect, at a reasonable price which is making it more attractive. I have just been informed that the title is leasehold rather than freehold. I am assuming that there are issues purchasing a leasehold house in Paignton. Conveyancing advisers have not yet been appointed. Will my lawyers set out the risks of buying a leasehold house in Paignton ?
Most houses in Paignton are freehold rather than leasehold. In this scenario it’s worth having a local solicitor who is familiar with the area can help the conveyancing process. It is clear that you are buying in Paignton in which case you should be looking for a Paignton conveyancing practitioner and be sure that they have experience in dealing with leasehold houses. As a matter of priority you will need to check the unexpired lease term. As a leaseholder you will not be entirely free to do whatever you want to the property. The lease will likely included provisions such as requiring the freeholder’sconsent to conduct alterations. It may be necessary to pay a service charge towards the maintenance of the communal areas where the property is part of an estate. Your conveyancer will appraise you on the various issues.
I am attracted to a couple of maisonettes in Paignton which have in the region of fifty years remaining on the leases. Will this present a problem?
There is no doubt about it. A leasehold apartment in Paignton 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 property. The majority of buyers and mortgage companies, leases with less than 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 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 Paignton 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 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 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 work for a long established estate agency in Paignton where we have witnessed a number of leasehold sales derailed due to short leases. I have been given inconsistent advice from local Paignton conveyancing solicitors. Could you confirm whether the seller of a flat can initiate the lease extension process for the purchaser on completion of the sale?
As long as the seller has been the owner 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 buyer need not have to wait 2 years to extend their lease. Both sets of lawyers will agree to form of assignment. The assignment needs to be completed before, or at the same time as completion of the disposal of the property.
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.
What makes a Paignton lease defective?
There is nothing unique about leasehold conveyancing in Paignton. Most leases are individual and drafting errors can result in certain provisions are erroneous. For example, if your lease is missing any of the following, it could be defective:
- A provision to repair to or maintain parts of the property
- A duty to insure the building
- Clauses dealing with recovering service charges for expenditure on the building or common parts.
- Maintenance charge proportions which don’t add up to the correct percentage
You may have a problem when selling your property if you have a defective lease primarily because it impacts on the ability to obtain a mortgage on the property. Nationwide Building Society, Norwich and Peterborough Building Society, and Clydesdale all have very detailed 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 provide security, forcing the purchaser to pull out.
Paignton Conveyancing for Leasehold Flats - A selection of Queries before Purchasing
It is important to be aware if a new roof is being installed or some other significant cost is pending to be shared between the tenants and may well materially impact the level of the maintenance charges or require a specific invoice.
Who manages the building?
You will want to discover as much as you can concerning the managing agents as they will affect your use and enjoyment of the property. As the proprietor of a leasehold property you will be in the clutches of the managing agents from a financial perspective and when it comes to daily issues such as the tidiness of the common parts. Ask other tenants what they think of them. In conclusion, be sure you understand the dates that you are obliged pay the service charge to the managing agents and specifically what you get for your money.