Frequently asked questions relating to Plymouth leasehold conveyancing
I've found a house that appears to meet my requirements, at a reasonable figure which is making it more attractive. I have subsequently been informed that it's a leasehold as opposed to freehold. I am assuming that there are particular concerns purchasing a leasehold house in Plymouth. Conveyancing solicitors have are soon to be appointed. Will they explain the issues?
The majority of houses in Plymouth are freehold and not leasehold. This is one of the situations where having a local conveyancer used to dealing with such properties who can assist with the conveyancing process. We note that you are purchasing in Plymouth in which case you should be looking for a Plymouth conveyancing solicitor and check that they have experience in advising on leasehold houses. First you will need to check the unexpired lease term. Being a lessee you will not be at liberty to do whatever you want to the property. The lease comes with conditions such as requiring the freeholder’spermission to carry out changes to the property. You may also be required to pay a service charge towards the upkeep of the communal areas where the property is located on an estate. Your solicitor will advise you fully on all the issues.
I am attracted to a couple of apartments in Plymouth both have approximately 50 years remaining on the leases. Will this present a problem?
There are no two ways about it. A leasehold apartment in Plymouth is a deteriorating asset as a result of the shortening lease. The closer the lease gets to zero years unexpired, the more it adversely affects the salability of the premises. For most buyers and mortgage companies, leases with less than eighty 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 premises 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 Plymouth 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 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 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 am employed by a busy estate agent office in Plymouth where we have experienced a few flat sales jeopardised as a result of leases having less than 80 years remaining. I have been given inconsistent advice from local Plymouth conveyancing firms. Can you clarify whether the vendor of a flat can initiate the lease extension formalities for the purchaser on completion of the sale?
Provided that 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. This means 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 purchaser.
Do you have any top tips for leasehold conveyancing in Plymouth with the aim of saving time on the sale process?
- Much of the delay in leasehold conveyancing in Plymouth can be bypassed where you appoint lawyers the minute you market your property and request that they start to collate the leasehold information needed by the purchasers’ lawyers.
- Many freeholders or Management Companies in Plymouth charge for supplying management packs for a leasehold property. You or your lawyers should enquire as to the actual amount of the charges. The management information can be applied for as soon as you have a buyer, thus accelerating the process. The average time it takes to receive management information is three weeks. It is the most common cause of delay in leasehold conveyancing in Plymouth.
Our conveyancer has advised that he intends to complete and exchange simultaneously on the disposal of our £200000 apartment in Plymouth in just under a week. The managing agents has quoted £336 for Certificate of Compliance, insurance certificate and previous years statements of service charge. Is it legal for a freeholder to charge an administration fee for a leasehold conveyance in Plymouth?
Plymouth conveyancing on leasehold apartments often necessitates the purchaser’s lawyer submitting enquiries for the landlord to answer. Although the landlord is under no legal obligation to respond to these enquiries most will be content to assist. They are at liberty invoice a reasonable administration fee for responding to enquiries or supplying documentation. There is no set fee. The average costs for the paperwork that you are referring to is over three hundred pounds, in some transactions it is in excess of £800. The administration charge required by the landlord must be accompanied by a summary of entitlements and obligations in relation to administration fees, without which the invoice is not strictly payable. In reality one has little choice but to pay whatever is demanded if you want to sell the property.
Plymouth Leasehold Conveyancing - A selection of Questions you should consider Prior to Purchasing
In the main the cost for major works are not incorporated into the service charges, albeit that there some managing agents in Plymouth obliged leasehold owners to pay into a sinking fund and this is used to offset against larger repairs or maintenance.
The best form of lease structure is a share of the freehold. In this arrangement the lessees enjoy being in charge if their destiny and even though a managing agent is frequently employed if the building is larger than a house conversion, the managing agent retained by the leaseholders.
Plenty Plymouth leasehold apartments will be liable to pay a service charge for maintenance of the block invoiced on behalf of the landlord. Should you buy the property you will have to pay this contribution, usually in instalments during the year. This could be anything from a few hundred pounds to thousands of pounds for large purpose-built blocks. There will also be a ground rent to be met yearly, this is usually not a exorbitant sum, say about £50-£100 but you need to check as occasionally it can be surprisingly expensive.