Frequently asked questions relating to Sale leasehold conveyancing
I am on look out for some leasehold conveyancing in Sale. Before I get started I require certainty as to the remaining lease term.
Assuming the lease is registered - and 99.9% are in Sale - then the leasehold title will always include the basic details of the lease, namely the date; the term; and the original parties. From a conveyancing perspective such details then enable any prospective buyer and lender to confirm that any lease they are looking at is the one relevant to that title.For any other purpose, such as confirming how long the term was granted for and calculating what is left, then the register should be sufficient on it's own.
I am hoping to put an offer on a small detached house that appears to meet my requirements, at a great price which is making it more attractive. I have since discovered that the title is leasehold as opposed to freehold. I would have thought that there are issues buying a leasehold house in Sale. Conveyancing lawyers have not yet been appointed. Will they explain the issues?
The majority of houses in Sale are freehold and not leasehold. In this scenario it’s worth having a local conveyancer used to dealing with such properties who can assist with the conveyancing process. It is clear that you are purchasing in Sale so you should seriously consider shopping around for a Sale conveyancing practitioner and check that they have experience in transacting on leasehold houses. First you will need to check the number of years remaining. As a lessee you will not be entirely free to do whatever you want with the house. The lease will likely included provisions such as obtaining the freeholder’sconsent to carry out alterations. You may also be required to pay a maintenance charge towards the maintenance of the communal areas where the property is located on an estate. Your lawyer will report to you on the legal implications.
I am looking at a two flats in Sale both have in the region of 50 years left on the leases. Should I regard a short lease as a deal breaker?
A lease is a legal document that entitles you to use the property for a period of time. As a lease gets shorter the saleability of the lease decreases and results in it becoming more expensive to extend the lease. This is why it is advisable to extend the lease term. Sometimes it is difficult to sell a property with a short lease because mortgage companies may be unwilling to lend money on such properties. Lease extension can be a difficult process. We recommend you get professional assistance from a solicitor and surveyor with experience in this area
I am employed by a busy estate agent office in Sale where we have witnessed a number of flat sales put at risk as a result of short leases. I have received contradictory information from local Sale conveyancing solicitors. Please can you confirm whether the owner of a flat can instigate the lease extension process 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 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 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 at the same time as completion of the sale.
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 are the frequently found problems that you witness in leases for Sale properties?
There is nothing unique about leasehold conveyancing in Sale. Most leases are unique and legal mistakes in the legal wording can result in certain sections are wrong. The following missing provisions could result in a defective lease:
- A provision to repair to or maintain parts of the building
- Insurance obligations
- A provision for the recovery of money spent for the benefit of another party.
- Service charge per centages that don't add up correctly leaving a shortfall
A defective lease will likely cause problems when trying to sell a property primarily because it impacts on the ability to obtain a mortgage on the property. Yorkshire Building Society, The Royal Bank of Scotland, and Bank of Ireland all have express requirements when it comes to what is expected in a lease. If a mortgage lender believes that the lease is defective they may refuse to grant the mortgage, obliging the purchaser to pull out.
I purchased a basement flat in Sale, conveyancing formalities finalised in 2004. Can you let me have an estimate of the premium that my landlord can legally expect in return for granting a renewal of my lease? Equivalent properties in Sale with an extended lease are worth £166,000. The average or mid-range amount of ground rent is £55 invoiced every year. The lease terminates on 21st October 2086
You have 66 years left to run we estimate the premium for your lease extension to span between £11,400 and £13,200 plus legals.
The suggested premium range above a general guide to costs for renewing a lease, but we cannot give you the actual costs without more detailed investigations. Do not use the figures in tribunal or court proceedings. There may be additional concerns that need to be considered and you obviously should be as accurate as possible in your negotiations. Please do not take any other action based on this information before getting professional advice.