Complexities in purchasing leasehold properties
4th October 2017
4th October 2017
In recent years the purchase of leasehold properties has become problematic due to lease terms, inflation of ground rents and poor management; because of this, I decided to put together a list of tips and general things steps to consider before offering on a leasehold, which I hope will be helpful!
Make sure your Solicitor/Conveyancer confirms the information you have received from the Estate Agent or Vendor, in particular, the following points:
1) The time remaining on the lease term. If this is on the shorter side (i.e. less than 80 years) confirm the cost involved in extending this.
2) The cost of the ground rent, and if and when this will increase.
3) The service charge fee, whether this includes buildings insurance and any additional fees for parking or any other services.
4) Is there a sinking fund in case of any major works necessary in the future and whether your contribution to this is included within the service charge or a separate payment (if so, at what cost).
5) Whether the parking is provision allocated. Confirm its location and how convenient it is for you. (Sometimes allocated parking is not on-site).
6) Are there any restrictions on things such as keeping pets, using the premises for business purposes or installing a satellite dish.
7) Does the lease allow you to sub-let the property? This is particularly important if you are purchasing as a buy-to-let.
The best advice I can give you asks. Anything you are unsure of, ask your Estate Agent, ask your Conveyancer and do not proceed until you are 100% comfortable.