Frequently asked questions relating to Tredegar leasehold conveyancing
Back In 2004, I bought a leasehold flat in Tredegar. Conveyancing and Leeds Building Society mortgage organised. A letter has just been received from someone saying they have taken over the freehold. Attached was a ground rent demand for rent dating back to 1994. The conveyancing practitioner in Tredegar who acted for me is not around.What should I do?
The first thing you should do is make enquiries of HMLR to be sure that this person is in fact the new freeholder. There is no need to incur the fees of a Tredegar conveyancing practitioner to do this as it can be done on-line for £3. You should note that regardless, even if this is the legitimate landlord, under the Limitation Act 1980 no more than 6 years of rent can be collected.
I am looking at a two flats in Tredegar which have about fifty years unexpired on the leases. should I be concerned?
There are no two ways about it. A leasehold flat in Tredegar is a wasting asset as a result of the reducing lease term. The nearer the lease gets to its expiry date, the more it adversely affects the value of the property. The majority of purchasers and banks, leases with less than 75 years become less and less marketable. 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 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 premises 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 Tredegar 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've recently bought a leasehold house in Tredegar. Do I have any liability for service charges for periods before completion of my purchase?
Where the service charge has already been demanded from the previous owner and they have not paid you would not usually be personally liable for the arrears. However, your landlord may still be able to take action to forfeit the lease. A critical element 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 agency in Tredegar where we have experienced a number of leasehold sales derailed due to short leases. I have received contradictory information from local Tredegar conveyancing solicitors. Can you confirm whether the seller of a flat can instigate 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 kick-start 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 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 advice can you give us when it comes to finding a Tredegar conveyancing practice to carry out our lease extension conveyancing?
If you are instructing a solicitor for your lease extension (regardless if they are a Tredegar conveyancing practice) it is imperative that they be familiar with the legislation and specialises in this area of work. We suggested that you speak with several firms including non Tredegar conveyancing practices before you instructing a firm. Where the conveyancing practice is ALEP accredited then that’s a bonus. Some following of questions might be of use:
- If the firm is not ALEP accredited then why not?
I bought a leasehold flat in Tredegar, conveyancing formalities finalised half a dozen years ago. Can you let me have an estimated range of the fair premium for a lease extension? Equivalent flats in Tredegar with an extended lease are worth £242,000. The average or mid-range amount of ground rent is £50 charged once a year. The lease ends on 21st October 2090
With only 70 years remaining on your lease the likely cost is going to be between £9,500 and £11,000 as well as professional fees.
The figure that we have given is a general guide to costs for renewing a lease, but we cannot give you the actual costs without more comprehensive due diligence. Do not use this information in a Notice of Claim or as an informal offer. There are no doubt additional issues that need to be taken into account and clearly you should be as accurate as possible in your negotiations. You should not take any other action based on this information before seeking the advice of a professional.