Buying and selling

Once you have purchased the flat, you will not have a legal right to extend the lease until you have owned the property for more than two years.

Alternatively, if your seller has owned the property for more than two years, you could ask them to extend the lease on your behalf and transfer that process over to you during the conveyance.

If your seller agrees to this, you will not have to wait for the two-year qualification process. To arrange this, your conveyancer will need to draft the necessary documents and send them to your seller.

We are sorry to hear that you have received a surprise bill soon after purchasing. As a recent buyer, this can be unexpected and stressful.

A large major works bill could potentially arise at any time depending on the repair and maintenance needs of the building.

The purpose of the form is that the seller provides a buyer with information that they can rely on to make the decision to commit to buying the property. If the information in the LPE1 was missing or incorrect, it could be that there was a misrepresentation on the part of the landlord or their managing agent.

If you suspect incorrect information was given in the LPE1, we suggest you speak with your conveyancer. They may be able to investigate the matter for you.

As soon as you become the registered owner of the flat, you will become eligible to jointly purchase the freehold of the building. With that said, if the existing leaseholders have already started the process of buying the freehold, they will have to agree amongst themselves to allow you to join in.

To help your chances, it might be a good idea to ask your conveyancer to write to the leaseholders to express your interest in participating once your purchase completes.

When buying a flat, it can be a stressful experience having your purchase delayed due to a hold up from someone else. Unfortunately, as you are not the leaseholder yet, you are not in a legal relationship with the landlord.

In this situation, there is nothing your solicitor can do to force the landlord to reply to these enquiries. The best thing you can do is ask your solicitor to continue to chase the landlord as this will put pressure on them to provide the answers.

There is no set rule about the length of a lease that is too short to sell.  

But when a lease falls below 80 years, the cost of extending it increases dramatically, making it harder to sell. 

Mortgage lenders, generally, will not lend on properties with a lease that is shorter than the mortgage. For example, it is difficult to find lenders who would provide a 25-year mortgage to buy a property that has just 20 years left on the lease. 

Ultimately, deciding whether your lease is too short and if you should extend it depends on your personal circumstances and your intentions about selling your property. 

It can be a complicated decision. This is how two leaseholders handled their situation. 

Case study: Belinda 

Belinda Jones was looking to sell her flat to move in with her daughter. Her lease had 60 years to run. She finally found a buyer who was interested in the property, but was reluctant because of the lease years. 

Belinda did not have the finances to extend her lease and was worried that she would never be able to sell the flat. 

LEASE advised Belinda to consider starting the legal process for extending the lease with a view to transferring it to her buyer. All she needed to do was get the ball rolling on the lease extension, and the buyer could take over from there after buying the property. 

In this win-win situation, Belinda could sell the house with the buyer paying the premium for the lease extension. Meanwhile, the buyer would not have to wait until after buying the property to start the process. 

Belinda’s estate agents helped her to negotiate a reduction in the sale price to reflect the shorter lease. 

Case study: Claire  

For Claire Smith the length of the lease was an important consideration when looking to buy a flat with 50 years remaining on the lease. 

She was not planning to stay in the area for more than 5 years, so the ability to resell was crucial. 

Claire checked the cost of a lease extension on the LEASE calculator.  

The estimated price was much higher than she was prepared to pay, so she made an informed decision not to buy the flat. 

More information you might find useful:

• Should I wait to extend my lease? I have heard that planned changes could make lease extension cheaper.
• Can I buy a flat and extend the lease at the same time?
• Lease Extension – Getting Started: advice guide
• Freehold vs leasehold conveyancing: flowchart
• More Frequently Asked Questions on Buying and Selling

Still not found the answer?

Contact LEASE to have your enquiry dealt with by one of our experienced advisers

It can be stressful receiving an unexpected bill from your landlord.

We would suggest that in the first instance, you contact your landlord and ask the landlord to prove that the fee is reasonable and justified. For example, you could ask for a detailed breakdown of the costs.

As you are selling your flat, you are unlikely to want to do anything that delays your sale. If all else fails, it may be possible to pay the fee and dispute it at a tribunal after you have sold the property.

For further information on how to challenge an administration fee or service charge, you can refer to chapter 6 in this advice guide.

Here is an example of how another leaseholder responded to an unreasonably high administration charge:

Penny Roberts contacted us to seek advice on what to do when she received a high administration charge for subletting her flat.

We asked to see the lease to find out whether she had to pay a fee at all.

The lease did require Penny to apply to the landlord for a licence before subletting. Because Penny was already aware of this requirement she had already made the application, but she thought the fee was disproportionate to the work involved in producing the licence to her.

We advised Penny that even though she was required to pay an administration fee for a licence to sublet, by law that administrations fee had to be reasonable and it must be accompanied by an administration charges summary of tenant’s rights and obligations.

Penny was prepared to take the matter to the tribunal to challenge it there but she did not need to. She persisted with the landlord and she managed to get a reduction in the fee by negotiating with them.

For more information on administration charges, you can read our advice guide.

Completion is the final step in the conveyancing process that typically occurs 7-28 days after exchanging contracts. On completion day, the money is transferred from the buyer to the seller and the official transfer of the property takes place.

When the lender receives the Certificate of Title from your solicitor, they will transfer the money over to them. The Certificate of Title is a document that gives a detailed history of the home’s ownership, including a comprehensive legal description of the property.

Once the final checks are complete, and the money is sent to your solicitor, they will then pass on the funds to the seller’s solicitor. When the solicitor receives the money and dates the legal transfer deed, completion has formally taken place. At this point, you are free to pick up the keys to your new home.

Leases can typically vary in length, for example, 99 years, 125 years or even 999 years.  It is the names of the original landlord and leaseholder that appear in the lease and they remain so even as the property that the lease represents is sold on over those 99, 125 or 99 years.

The new leaseholder’s name will be shown as the owner of the property at Land Registry which is a public register, not in the lease itself.

To find your rights and responsibilities, you should start out by reading your lease.

If you find it tricky to read through, you could refer to the contract report your conveyancer gave to you before you exchanged contracts. This report will summarise the important rights and obligations set out in your lease.

In addition to your lease, there are certain rights that are given to you in law. For example, the right to extend the lease or the right to collectively enfranchise.

For more information on this, you can search our website or book a telephone appointment to speak to one of our advisers.

Once your purchase is fully completed, your name will appear as the proprietor at Land Registry.

The Land Registry is a public register of property information and this is all you need to prove you are the owner. To obtain an up-to-date copy of the property information you can search the Land Registry website.

The registry will show who owns the property, the full address of the property, and whether the property is registered as leasehold or freehold.

The flat you are about to purchase should be properly reflected by the terms of the lease and its plan. The lease plan should match the physical layout of the property.

If they do not match, there could be an inconsistency in the records for the property. In this event, it is important to inform your solicitor as soon as possible, as the lease might need to be amended to reflect the current layout of the property.

Although your conveyancer will have a copy of the lease, they will not have inspected the property you are buying, and so cannot identify any alterations without information from you. In light of this, it is important to let your conveyancer know any alterations and extensions that have been made to the property you are buying.

When you buy a property, there are a number of searches that your solicitor needs to undertake as part of the conveyancing process to enable your solicitor to investigate whether the property you are buying is suitable.

The usual searches include:

• Environmental search – shows whether there is contaminated land in the vicinity or any flooding risks.
• Local authority search– shows whether the property is listed or in a conservation area or any proposed building works in the area.
• Drainage search – to show the layout of the sewerage system and the water supply to the property.

If you are purchasing a flat, it is important to note that there is no definitive time scale to work towards.

Although timing can vary, a straight forward transaction should take roughly 12 weeks. There are a number of complications that could increase the time scale, such as, the length of chain or delays in receiving search results and replies to enquiries.

Although your lender may have approved subletting, you still need to be sure as to whether you need your landlord’s permission to sublet.

You will need to check the lease before you sublet, to be sure that you are entitled to do so, and whether or not there are any conditions attached to subletting.

Your conveyancer should be able to advise you on the terms of lease.

If you are buying a flat and plan to carry out work on the property you should look at the terms and conditions of the lease before you exchange contracts.

The lease agreement to the property will set out any rights and restrictions on altering the property. The lease will also tell you whether or not works, such as extensions are permitted and whether there are conditions that need to be satisfied when carrying out such works.

Carrying out improvement works to your property can be exciting and can add value to your property, but failure to comply with the terms and conditions of the lease agreement could result in a breach of the lease. In the event of a breach, the landlord might force you to pay for more building works to put everything back the way it was. To avoid this, it is important that you do not start any work on a property without knowing what work you are allowed to do; and whether consent is required.

From the outset, any lender will want to know that the property you are looking to purchase is worth the money that they are lending.

When you purchase a property your conveyancer will usually represent your lender too. In practice, this means your solicitor will report to your lender and answer any questions they have about the property.

In addition to this, your lender will send a valuer to the property and will base their mortgage offer on that examination.

Towards the end of the conveyancing process, your conveyancer will forward a document to your lender that reports on whether the lease provides acceptable security for their mortgage. This document will also highlight any problems with the property, such as provisions in the lease that don’t meet the lender’s requirements.

If your lender is not satisfied with an aspect of the property, they may reject your application. Before rejecting your application, your lender will typically ask your conveyancer to give the seller an opportunity to deal with any issues.

If a seller breaches their lease and the breach has not been settled before you purchase, there is a chance that the landlord could expect you to fix the breach.

When you are purchasing a property, it is important that your conveyancer investigates if there are any outstanding breaches and asks the seller to deal with them before you exchange contracts.

Having to deal with a breach that is not your fault can be very stressful.

Here is an example of how another leaseholder handled this situation:

John Scholes was looking to purchase a flat, where the current owner had converted the kitchen. The owner should have asked the landlord for permission, but didn’t, so she was in breach of the lease. The landlord had not objected to the alteration, possibly because they were not aware it had been done.

As a result, John was left with the following options:

1. Fix the breach by converting the kitchen back the way it was. This would be very expensive and time-consuming; or
2. Get retrospective consent from the landlord. This might be tricky and could also prove expensive; or
3. Get indemnity insurance, which would payout if the landlord asked for the breach to be fixed; or
4. Not buy the property.

After evaluating his options, John S eventually decided not to buy the flat.

In the first instance, you could ask the seller to provide this information.

During the conveyancing process, your solicitor will ask certain questions of your seller’s solicitor and to the landlord or management directly. These questions allow your solicitor to form a picture of the property, the condition of the building, and the landlord’s projected plans for the building.

The LPE1 form is the document sent to landlords which contains the necessary questions about future works of repair. Make sure you fully review the replies to this form when your solicitor sends it on to you and if you have any doubts raise them with your solicitor.

For more on this, we have a webinar that explains the purpose of the LPE1 form and the information it contains.

When you purchase a flat, your conveyancer will get information about the property from the Land Registry. This will include the title deeds and other documents that report on whether you can sublet the property, carry out alterations, or keep pets.

Your conveyancer will review this information and report back to you on whether to go ahead and commit to purchasing the property.

If you want to view the title information in advance, you can ask your conveyancer to send it to you. Alternatively you can order a copy of the title information directly from Land Registry, but you will need to pay a fee for this.

Most property for sale comes with particulars that state whether it is leasehold or freehold. The estate agent should also be able to tell you. 

You can find out for yourself by searching for property information on the HM Land Registry website. 

The publicly accessible register shows who owns a property, its full address, and whether it is leasehold or freehold, and when the lease runs out.  

It is free to search the property summary, which should indicate the type of tenure, but there may be a fee for other services. 

More information you might find useful:

• Buying a flat: advice guide 
• More Frequently Asked Questions on buying and selling

Still not found the answer?

Contact LEASE to have your enquiry dealt with by one of our experienced advisers