You instruct a conveyancer to act and look after your interests when purchasing a leasehold property. You go to that conveyancer to ensure he exercises the skill and care required to ensure that the property you are purchasing can become a home free of legal issues.
As part of that due diligence process your conveyancer will send to you information about the lease as well as a copy of the lease for you to read through. He will if he does his job correctly identify what might be wrong with the lease and what he suggests should be done to sort any problems.
This may all be very daunting and in effort to help you understand what to look for and what to query if your conveyancer fails to cover an aspect I have set out below some ( and it’s not intended to be an exhaustive and comprehensive list ) common points to keep in mind:
Have you been provided with a completed copy of the lease?
Has your copy been signed?
How many years does the Lease have to run? If the remaining term is under 80 years you should seriously consider pulling out unless the seller is prepared to arrange for the lease to be extended before you purchase.
Does the property description in the lease mirror the property you are looking to purchase. Check the lease plan against the floor layout shown in the sale particulars. Take the plan and carry out a physical inspection of the property to check for discrepancies.
If you are told there is a garden and or car parking space then make sure this is included as part of the description of the property you are purchasing.
What parts of the property and the amenities are you required to share with other tenants?
Is there a right to pass to and from the property from the closest public highway? If not you may find that someone else could legally prevent you from accessing the property.
How much is the annual ground rent and service charge – can you afford these remembering they can increase depending on the clauses in the lease and the expenditure incurred by the landlord in the upkeep of the building and communal areas.
Check the rent review clause - the ground rent might only be £250 per annum at the time of purchase but this could by the end of the term be as much as a million pounds per annum!
Is there a management company and if so is it properly run and has accounts to show that it takes its responsibilities seriously.
Is the property adequately insured?
What are the restrictions on use of the property? Can you sub-let for instance and if so what conditions have to be met?
Even though the landlord is responsible for the upkeep of the property you should always get a survey undertaken since if there is major work required you and the other tenants will be required to contribute to that cost however much the expenditure might be.
Finally do consider carefully whether a leasehold property is for you - many conveyancers including myself advise clients not to purchase this type of property unless there are very compelling reasons so to do.