If you are thinking of buying leasehold property then read this guide to the conveyancing process, written by property solicitor Liam Harris.
Purchasing a property is an exciting yet complex process, especially when dealing with leasehold properties. Unlike freehold properties, which grant ownership of the land and property indefinitely, leasehold properties involve an agreement between the leaseholder (buyer) and the freeholder (landlord) for a specific period. To navigate this process smoothly, understanding the conveyancing steps is crucial.
Offer Acceptance and Instruction of Conveyancer
Once you’ve found a leasehold property you wish to buy and your offer is accepted, it’s time to instruct a solicitor. We’ll handle the legal aspects of the purchase and guide you through the process.
Lease Examination
We will obtain a copy of the lease from the seller’s solicitor. The lease will outline the terms and conditions of your ownership, including the lease duration, ground rent, service charges, any restrictions, and obligations. We will also examine the terms to ensure they’re acceptable and in line with your expectations.
Property Searches and Enquiries
Various searches are conducted to reveal information about the property. This includes local authority searches to check planning permissions, environmental searches to assess potential risks, and more. Enquiries are also made to the freeholder or managing agent to clarify any doubts about maintenance, service charges, and ongoing responsibilities.
Management and Service Charges
We will analyse the management and service charges associated with the property. We’ll also review any outstanding payments and ensure you’re aware of future financial obligations. Understanding these charges is essential as they affect the ongoing costs of owning the leasehold property. Generally these costs will increase over time at it is therefore essential
Mortgage Arrangements
If you’re using a mortgage to purchase the property, your lender will conduct their valuation and assessment. We will liaise with the lender to ensure all legalities align with their requirements. We will also manage the transfer of funds between you, the lender, and the seller.
Exchange of Contracts
Once all searches, enquiries, and legal checks are completed satisfactorily, you’re ready to exchange contracts. At this stage, you and the seller commit to the transaction. You’ll pay a deposit (usually 10% of the property’s value) which is held by us until completion.
Completion and Transfer of Ownership
Completion day is when the remaining funds are transferred, and ownership of the leasehold property officially changes hands. We will handle the transfer of funds and register you as the new leaseholder with the Land Registry.
Post-Completion Obligations
After completion, we will ensure that the necessary notices are served on the freeholder or managing agent to update records and ensure future service charges and ground rent demands are directed to you.
Conclusion
Buying a leasehold property involves a meticulous conveyancing process to safeguard your interests and ensure a smooth transaction. Having a knowledgeable conveyancing solicitor by your side is invaluable, guiding you through each step and ensuring you fully understand the terms of the lease before you commit.
Remember, each leasehold purchase is unique, and seeking expert advice is key to making informed decisions and securing your future investment.
For further guidance on buying leasehold property and a fixed fee quote contact Liam Harris by calling freephone 0333 888 0419 or emailing us at [email protected]
